Litro Gas Lanka Ltd recently announced the price hike of a Litro gas cylinder (12.5Kg) by Rs. 245/-, following approval from the Consumer Affairs Authority (CAA).
The price increase was a necessity and a long overdue step that the company was compelled to take, owing to the volatile nature of the industry prices which is largely determined by two key variables, namely; the Saudi Armco Contract Price (CP) (announced on a monthly basis) as well as the country’s currency exchange rate.
World gas prices went down by US$ 41.5 (approximately to 8%) during March 2018 and rose again marginally by US$2 in April 2018. However, gas prices recorded a drastic increase of US$32 in May 2018. Experts predict that the May price hike signals a potential trend of continuously high prices. In addition to this, the long-term volatility of the world prices combined with the fact that the Sri Lankan LPG companies were unable to implement a reciprocal price increase resulted in the requisite price increase of Rs 245/= per cylinder.