Cost of cooking gas cylinders reduced

The Sharjah Economic Development Department (SEDD) has slashed the prices of cooking gas (LPG) for the next one month by approximately Dh5 per cylinder, according to a report in Gulf Today.

It has fixed the prices of cooking gas at Dh48, Dh95 and Dh190 for the 11kg, 22kg and 44 kg cylinders respectively.

Distributors will pay approximately Dh40, Dh80 and Dh180 per cylinder at the three filling stations in Sharjah during this period.

This means distributors will have to sell the gas for Dh48, Dh95 and Dh190. They have been allowed to charge only Dh5-10 per cylinder from customers, which is almost Dh10 less than what they charged in the previous three months.

Gas prices in Sharjah was not affected by the price fluctuation in the international oil market during the past few months. SEDD decided not to increase the cylinder prices. However, the neighbouring Northern Emirates slashed the gas prices during the past a couple of months because of international oil price fluctuations.

The distributors, however, are not happy with their share of profit as distribution costs are “too high compared to the profit", they claim.

“Gas distributors have been pushed to a corner. We know they cannot run the business with this profit margin. But we are helpless,” a filling station source said.

The volatility in oil prices has been rising over the years. This is probably the most frequently asked question in the industry, and there are so many answers.

Meanwhile, inter-emirate and inter-state smuggling of cooking gas has escalated. This is happening mostly through the borders of Oman.

The LPG filling station sources as well as distributors in Sharjah said that inter-emirate smuggling of cooking has been increased.

The gas filling station sources said that the current income of distributors can not sustain them in this highly competitive and fragile industry.”

“If you want gas for Dh40, you will get that much on the Omani side. We all know that,” said a source at one of the three gas filling stations in the Sharjah Industrial Area.

The gas distributors filed a petition with SEDD for review of the distribution prices of gas cylinders, which was not answered even after several months, they said.

Some of the gas agencies and distributors, hold the view that there are some cylinders which has been expired, but they are still circulating in the emirate. “We do not know its origin.”

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