Prime Minister Shehbaz Sharif announced that the era of the LPG mafia is over, stating that groups which made billions of rupees from the trade for decades no longer control it. The Prime Minister made these remarks while chairing a federal cabinet meeting on Wednesday, according to a video shared by the Government of Pakistan.
The Prime Minister stated that LPG imports and supply will now be managed through competition and transparency, with state-owned companies including PSO and PARCO bringing in the fuel. He further noted that the first auction for locally produced LPG is scheduled to be held next week under camera supervision. Additionally, importing companies will be required to post their landed costs on their websites.
Under the new LPG policy approved by the cabinet, four state-owned firms—PSO, Pakistan LNG, SSGC-LPG, and PARCO-LPG—will resume imports via government-to-government and business-to-business deals. These firms have already received supply offers from Oman and Saudi Arabia. The policy also abolishes the discretionary quota system that previously benefited influential groups.
Local producers will sell LPG through open auctions in lots of five to 10 tonnes, which will be monitored by the Petroleum Division and OGRA. The base price will be tied to Saudi Aramco’s monthly contract price, and OGRA will cease issuing LPG price notifications.
The Prime Minister said that profits from these auctions will be directed to the national treasury to subsidize LPG for ordinary people. Under the policy, that money goes into a fund for BISP-eligible households.
This policy shift follows a period where cylinder prices in the open market reached as high as Rs. 7,200, which is more than double the OGRA notified rate of Rs. 3,296. The Prime Minister suggested that if the new auctions and imports increase the supply, the gap between official and market prices should narrow.
