Retail prices of gas cylinders in Dubai and Northern Emirates have been increased by between 13 and 17 per cent, with effect from December 14, 2013, in line with escalating international gas prices, according to the two LPG manufacturers, Emarat and Emirates Gas.
“An 11kg LPG cylinder now costs Dh85 compared to Dh 75 earlier. The price of 22kg cylinder, which is used mostly by households, has increased from Dh120 to Dh140, and that of big LPG cylinders of 44kg has been increased from Dh250 to Dh290,” said the manager of a Dubai-based gas distributor. The price increase is in the range of 13.33 per cent to 16.66 per cent, depending on the size of the LPG cylinder.
For some small and medium-sized restaurants in Sharjah and Ajman, the latest hike in LPG prices follows a recent termination of discounts that manufacturers used to offer their commercial customers.
“We used to get a discount on big cylinders. Instead of the Dh250 charged from household customers for a 44kg LPG cylinder, we used to pay Dh200 or Dh220. When the gas distributors removed the discounts last month, restaurants were unhappy and with the current increase, our margins are again under pressure,” said the owner of an Indian restaurant in Ajman. “For us, the effective price increase is from Dh200 to Dh 290, which is quite substantial,” he added.
On the other hand, gas distributors have been incurring additional costs to meet stringent safety criteria set by the Emirates Standardisation and Metrology Authority that recently issued fresh guidelines on storage and transportation of gas cylinders.
It is no longer allowed to roll the LPG gas cylinders or to leave them in open, as was the practice earlier. LPG cylinders can now be moved only on trolleys and they have to be stored in shade, away from the sunshine.
“We used to offer discounts to restaurants using big cylinders when there was a slowdown in Ajman and many families were leaving. In order to keep our regular customers happy, we used to slash our profit margin and offer discounts. Now, the demand is strong again as more families have come in and labour camps are active in Ajman,” said a gas distribution company manager.