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Litro claims no profit despite price hike 

11 Oct 2021

  • 12.5 kg cylinder increased to Rs. 2,750; then reduced to Rs. 2,675
BY Pamodi Waravita Litro Gas Lanka Ltd. claimed that increasing the price of a 12.5 kg cylinder of gas by Rs. 1,182 does not bring any profit to the company and only covers the costs incurred due to both rising world market and international shipping and freight-related prices.  This announcement was made after Litro increased the price of a 12.5 kg cylinder of gas to Rs. 2,750 on Sunday (10) evening, only to announce yesterday (11) that the price has been brought down by Rs. 75 to Rs. 2,675. Despite the Rs. 75 reduction, the new price of Rs. 2,675 still constitutes a significant increase from the previous price of Rs. 1,493. “Litro Gas Lanka maintained stabilised prices for over a year despite a global price increase. As the national liquefied petroleum gas (LPG) provider, Litro Gas Lanka understands the importance of stabilised pricing; however, rising international prices and rising international shipping and freight rates have affected the current price increase. This increase will only cover our cost. The result of this price increase does not account for any profit to the company,” the company claimed in an official media announcement made yesterday. The new prices for the Colombo District stand at Rs. 2,675 per 12.5 kg domestic cylinder, Rs. 1,071 per 5 kg domestic cylinder, and Rs. 506 per 2.5 kg domestic cylinder. The private player in the market Laugfs Gas PLC also increased its prices this week. Thus, the new prices for the Colombo District are Rs. 2,840 for a 12.5 kg domestic cylinder and Rs. 1,136 for a 5 kg domestic cylinder. Following a special Cabinet of Ministers meeting held on 7 October with President Gotabaya Rajapaksa, the Government decided to remove the price controls on cement, LPG, milk powder, and wheat flour. As global market prices of gas have increased significantly, both Litro Gas Lanka and Laugfs Gas had been requesting the Government that they be allowed to increase local prices as well. Although the Government rejected these requests on multiple occasions, it finally allowed Laugfs Gas to hike the LPG price by Rs. 363 for the 12.5 kg cylinder in August. At the time however, Laugfs Gas PLC Chairman W.K.H. Wegapitiya told The Morning that he was “unimpressed” by the permitted hike, due to the prevailing world market prices. Consumers have constantly complained about a shortage of both Laugfs Gas and Litro Gas Lanka gas cylinders in the market over the past two months. Meanwhile, in a media communiqué made on 1 October, the Litro Surakeeme National Unity organisation claimed that the “decision to not increase gas prices parallel to cost fluctuations during the past nine months resulted in a loss of Rs. 10.5 billion for Litro Gas Lanka”. Thus, the organisation alleged that if the Treasury Department does not grant monetary assistance to purchase LPG, Litro Gas Lanka will not be able to import LPG from November onwards.


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