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LPG retail prices regulated by market in Kazakhstan

Kazakhstan Materials 12 March 2021 09:39 (UTC +04:00)
LPG retail prices regulated by market in Kazakhstan

BAKU, Azerbaijan, March 12

Trend:

The temporary state regulation of retail prices for liquefied petroleum gas at gas filling stations has been canceled in Kazakhstan since March 1, Director of the Gas and Petrochemicals Department of the Kazakh Ministry of Energy Kuanysh Sarsekeev said, Trend reports with reference to the Kazakh Ministry of Energy.

The temporary state regulation for the sale of liquefied petroleum gas for refueling vehicles at gas stations was introduced in April 2020 upon the decision of the state commission to ensure the state of emergency under the president of the Republic of Kazakhstan.

The corresponding joint order of the Ministry of Energy, Ministry of National Economy and Ministry of Justice made it possible to keep retail prices for LPG at gas stations during an emergency situation and during the recovery period.

“Currently, retail prices at gas stations are set by the market taking into account supply and demand,” Sarsekeev added at a briefing of the Central Communications Service. “The retail price of liquefied petroleum gas, analyzed by the Ministry of Energy, showed that the current prices at gas filling stations are lower than in the first quarter of 2020 before the pandemic by an average of five percent in the country. That is, the current market prices are even lower than the previous ones.”

At the same time, the Ministry of Energy continues to formulate a plan for the supply of liquefied petroleum gas to the domestic market on a monthly basis, 25 percent of which is currently being sold through electronic trading platforms. The liquefied petroleum gas sold outside the electronic trading platforms is sold at the wholesale limit price approved by the Ministry on a quarterly basis.

The ministry approved the wholesale price for liquefied petroleum gas for the first quarter of 2021 at 38,701 tenge ($92.25) / ton, excluding VAT (prices have not been changed since January 1, 2018).

The price was at a similar level - 38,701 tenge ($92.25) / ton excluding VAT, except for the third quarter in 2020, when the cost dropped to 28,000 tenge ($66.74) / ton excluding VAT due to a decrease in the world prices for liquefied gas.

National Atameken Chamber of Entrepreneurs and the relevant associations have repeatedly appealed to the state agencies with a request to limit the validity of the order. If it was extended, entrepreneurs could have faced the risk of staff and employee salaries cuts.

“The low prices in certain regions could have contributed to the flow of gas volumes to other regions with higher prices, which could create a shortage of liquefied gas in certain regions,” Sarsekeev added.

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