The government is considering the request made by LP gas companies to increase the price of LP gas cylinder with immediate effect owing to rapidly increasing world gas prices.
Trade Minister Bandula Gunawardena said that the proposal to increase the LP gas price will be presented to the next cabinet meeting for its approval.
He noted that the LP gas price has not been increased during last five years despite rupee depreciation and increasing international LP gas prices.
The two LP gas providers has made a request to increase the price to the Consumer Affairs Authority (CAA) and they are waiting for an immediate response, officials of these companies said.
In the wake of rising world market prices and rupee depreciation, LP Gas companies have made a request from the government authorities to increase the price of a 12.5kg domestic LP gas cylinder by at least Rs. 407 with immediate effect, official sources said.
In addition, prices of the 5kg domestic LP gas cylinder will also be increased proportionately.
Quoting Saudi ARAMCO price index, LP gas companies noted that the world market price of Propane has increased to USD 605 per metric ton.
Accordingly, the current price of the 12.5kg domestic cylinder, which was at Rs. 1,493, will go up to Rs. 1,900. However, the prices will vary according to different districts.
Price applications submitted by gas companies will have to be passed by the Cabinet of Ministers.
"The determination of the price was assigned to the Cost of Living Committee. Considering the rising world market prices and it should be approved and announced by the Consumer Affairs Authority (CAA) in consultations with relevant gas supplier companies," a CAA official said. Noting that the world market prices are fluctuating factors which cannot be controlled by countries, but senior official of the CAA predicted this upward trend in cost would continue till early next year.
“The regulation of gas business is under the CAA. The CAA signed an agreement on the prices in 2007 with then Shell and continued with Litro after the takeover. The same year, a pricing formula was introduced. Since then, there had been many price changes up to now," the official added.