If you thought gas bills were higher last month, brace yourself – the latest gas bill is likely to be shockingly high, impacting natural gas consumers across Pakistan.
This spike is because the country’s Oil and Gas Regularly Authority (OGRA) has increased the gas tariff for the second time in the ongoing financial year 2023-24.
OGRA has announced a substantial increase in gas tariffs for both Sui Northern Gas Pipelines Limited (SNGPL) and Sui Southern Gas Company Limited (SSGCL).
This decision comes as a severe blow to consumers already struggling with unaffordable gas bills and overall inflation, exacerbating their financial burdens.
Price for SNGPL hiked by 35% and SSGCL by 8.57%
Under the revised rates, SNGPL faces a substantial surge of 35.13% in tariffs, while SSGCL’s rates are elevated by 8.57%.
The decision follows OGRA’s recommendation on February 2, 2024, proposing a significant hike in the average gas price to Rs1,590 per MMBTU (Metric Million British Thermal Unit), up from the previous rate of Rs1,291 established in June 2023.
Effective from January 1, 2024, until June 30, 2024, these revised rates come as the second adjustment in gas prices within the ongoing financial year 2023-24. This move aims to address a staggering Rs98 billion shortfall plaguing the nation’s economy.
This adjustment aligns with mounting pressure from the International Monetary Fund (IMF), which advocates for biannual revisions to gas prices as a means to alleviate the burgeoning circular debt.
“The IMF wants the government to implement the gas review implementation biannually to reduce the circular debt, which currently stands at Rs1,250 billion. The OGRA is bound to announce the gas tariff biannually and the government is bound to enforce gas prices from July 1 and then from January 1 in any current financial year,” The News reported.
In response to OGRA’s decision, Sui Northern’s gas tariffs have surged to Rs1,673.82 per MMBTU, marking a substantial increase from the previous rate of Rs1,238.68. Similarly, Sui Southern’s gas tariffs have risen to Rs1,466.40 per MMBTU, up from Rs1,350.68 per MMBTU.
Many people expressed shock over the news of the second gas hike, calling it an unbearable burden for the people facing high inflation rates as affordability of essential utilities becomes a pressing concern for ordinary citizens.
Pakistan’s caretaker government led by Prime Minister Anwaar ul Haq Kakar had increased the gas prices up to 193% effective from November 2023 to June 2024, to help the government collect revenue of Rs980 billion.
Pakistan increased fuel prices in February 2024
On February 1, 2024, the Pakistani government increased the prices of petrol and diesel by as much as Rs13.55 per liter.
The price of petrol went up by Rs13.55 to Rs272.89 a liter, while that of diesel increased by Rs2.75 to Rs278.96, according to the notification.
Pakistan revises petroleum prices every fortnight. The prices of petrol and diesel were increased on the recommendation of OGRA.