LPG supply and pricing instability in South Asia

Liquefied petroleum gas (LPG) availability and pricing have faced significant volatility in South Asia. In late September 2026, India reported that public-sector oil marketing companies were freezing new domestic LPG connections, forcing some consumers toward more expensive 10-kg composite cylinders. Simultaneously, Pakistan’s Oil and Gas Regulatory Authority (OGRA) implemented a price increase for October 2026.

By mid-October, the situation in Pakistan escalated as market prices for an 11.8kg cylinder reached approximately Rs 5,000, far exceeding the OGRA maximum price of Rs 3,296. These shortages were attributed to import constraints, terminal delays at Gwadar, and shipment disruptions at the Taftan border.

In response to these pressures, Prime Minister Shehbaz Sharif rejected a proposal to auction LPG produced by state-owned enterprises. The rejection was based on the absence of a sufficient legal and regulatory framework and concerns that linking local prices to import parity could increase costs by at least 15 per cent. The Petroleum Division stated its goal is to maintain a competitive mechanism that prevents supply concentration and ensures availability in remote and hilly regions.