Possibility of Further Increase in Gas Prices

ISLAMABAD: People are already under the burden of inflation and now another major increase in gas prices is expected. Gas supply companies have requested the government to raise gas prices to meet their financial difficulties and losses.

According to reports, Sui Northern Gas Company has demanded an increase in the average price of gas to Rs 2485 per MMBTU, stating that the average price of gas is more than Rs 700 billion. On the other hand, Sui Southern Gas Company has claimed a loss of Rs 883 billion, requesting the average gas price to be Rs 4137 per 49 paise per MMBTU. These companies have also requested their already existing billions of rupees from consumers.

It is a matter of concern that just four months ago, gas prices were increased by more than 25 %, and gas prices have been raised at least five times in the last two years.

At a time when energy prices are falling globally and the government has also reduced electricity prices, and the prices of petroleum products are expected to get relief, the demand for such a huge increase in gas prices is not only surprising but will also be an unbearable burden on the general consumers.

Gas is a crucial fuel for industries, and an increase in its price will lead to a rise in industrial production costs, consequently pushing up the prices of goods further.

Experts say gas distribution companies should reduce their losses by controlling gas theft, leakage and old delivery system flaws instead of transferring their financial deficits directly to consumers. According to them it does not justify putting all the burden on consumers.

Now it remains to be seen how the government reacts to this situation and does it take effective steps to protect the public from this new storm of inflation.