Pakistan’s already struggling households and businesses face the prospect of sharply higher gas bills after the country’s two dominant gas distribution companies filed petitions seeking substantial price increases that could push rates well above Rs1,700 per million British thermal units.
Sui Northern Gas Pipelines Limited has asked the Oil and Gas Regulatory Authority to approve a modest Rs10 increase, bringing its average prescribed price to Rs1,712.40 per MMBtu. But Sui Southern Gas Company has requested a far steeper jump of Rs366.75 per MMBtu, seeking approval for rates of Rs2,071.75.
Both utilities want the new rates applied retroactively from July 1, the start of the current fiscal year, a move that could result in sudden adjustment charges for consumers who have already received months of service.
The timing could not be worse for Pakistani families. The petitions arrive as winter approaches and the nation confronts severe energy supply constraints driven by dwindling domestic gas reserves and heavy reliance on expensive imported liquefied natural gas.
SNGPL has built Rs60.147 billion in LNG service costs into its pricing proposal, estimating that each MMBtu of LNG service will cost Rs471.16. The company warns that shrinking local gas production during winter will force it to arrange 16 LNG cargo shipments just to keep supplies flowing.
Both companies point to rising international crude oil prices as a key driver, arguing that higher oil costs inevitably push up gas expenses as well. Pakistan’s energy sector has become increasingly vulnerable to global price swings as domestic gas fields mature and output declines.
The country now depends heavily on LNG imports to bridge the widening gap between what it produces and what it consumes. That dependence has exposed Pakistan to supply disruptions and price volatility in international markets, complicating government efforts to secure adequate fuel ahead of peak winter demand.
Authorities have already implemented gas load management for households, restricting supply to specific cooking hours in the morning, afternoon, and evening because the system cannot meet continuous demand. The Petroleum Division estimates that 24 LNG cargoes will be needed to satisfy winter requirements on the SNGPL network alone, covering both residential use and power generation.
The government is finalizing a winter gas management plan for November through February that prioritizes domestic consumers while potentially curtailing supplies to industry, captive power plants, fertilizer producers, and CNG stations if shortages become severe or LNG deliveries fall short.
Adding to the sector’s troubles, gas-sector circular debt has ballooned to Rs3.631 trillion as of June 30, an increase of Rs344 billion. The mounting unpaid liabilities have strained gas utilities financially and made it harder to maintain reliable supply infrastructure.
The prescribed price set by OGRA represents the average rate needed to cover a utility’s estimated revenue requirements. It differs from the category-specific prices that consumers actually pay, which require government approval and formal notification.
In July, the government chose to keep existing consumer gas tariffs unchanged despite OGRA setting lower prescribed prices for both utilities. The regulator had determined SNGPL’s prescribed price at Rs1,718.96 per MMBtu and SSGC’s at Rs1,691.24 for the fiscal year.
OGRA will conduct public hearings on the new petitions before issuing its determination. Any actual change in what consumers pay will depend on subsequent government decisions and official notifications.
For millions of Pakistanis already grappling with high inflation and economic uncertainty, the prospect of steeper gas bills adds another layer of financial pressure as winter demand peaks and energy costs climb.
