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No gas price increase

07 May 2021

  • State Min. plans to curtail suppliers’ costs 

  Following a meeting on Tuesday (4) evening to look into the possibilities of increasing the local prices of gas with relevant authorities, the State Ministry of Co-operative Services, Marketing Development, and Consumer Protection has decided to not to increase local gas prices. Speaking to The Morning Business, State Ministry Secretary K.D.S. Ruwanchandra stated that a solution was also evaluated to the issues projected by the gas companies to the Government during the meeting. “We have discussed the other options as well, and we are currently planning to curtail the cost structure of these gas companies,” Ruwanchandra stated. According to local media reports, gas supplying giant Laugfs suggested that the price of gas should be increased by at least Rs. 400, adding that at present, a loss of Rs. 550 per gas cylinder is incurred. Thereby, the State Ministry is currently evaluating the possibility of greater synergy between gas companies to reduce costs, as a measure to support the firms and resolve the issue. In an interview held on Tuesday afternoon, Ruwanchandra revealed that a gas price increase was another option that the State Ministry was eying. According to local reports, Trade Minister Bandula Gunawardena informed Cabinet on Monday (3) that there is a shortage of gas due to delays in imports. The delay was reported to be influenced by gas companies refusing to import further supplies, due to not being allowed to increase gas prices. As the announcement was made at a Cabinet meeting chaired by President Gotabaya Rajapaksa, the President instructed the Minister of Trade to take necessary steps to find out more details regarding this gas shortage. Accordingly, Laugfs Gas confirmed that there was already a shortage, while stressing that there would be no positive response from the Government if they were asked to revise gas prices in line with the increased gas prices in the world market. However, Litro Gas announced to local media that there is no shortage of gas, as there are sufficient stocks. It was also revealed that a ship carrying gas arrives at Litro Gas every three days. Nevertheless, Litro Gas pointed out that the company shares the same problem that Laugfs Gas is facing: the non-increase in gas prices. On the other hand, the National Movement for Consumer Rights Protection (NMCRP) levelled allegations against Litro Gas Ltd. in end-April for increasing the price of a gas cylinder by introducing a new product named “Premium Hybrid”, and thereby deceiving consumers.  


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