Cooking gas prices set to rise as demand surges in Asia

Households are set to pay more for liquefied petroleum gas (LPG) on increased demand for the commodity in Asia due to a potentially colder start to winter and higher heating requirements.

Energy and Petroleum Regulatory Authority (Epra) director-general Pavel Oimeke said the global price of LPG increased by $25 (Sh2,752.5) per tonne between September and October.

“The price increase is as a result of the recovery of demand in India and Asia,” he said without indicating by how much LPG prices would increase in the Kenyan market.

Currently, the 13-kilogramme cooking gas retails at between Sh2,100 and Sh2,200.

However, Mr Oimeke said that per capita consumption of LPG in Kenya had increased from 2.2 kilogrammes in 2013 to 6.4 kilogramme last year.

“The increase is attributed to improved supply of LPG leading to higher penetration and also awareness creation on the benefits of LPG being one of the cleanest sources of domestic energy,” he said.

Mr Oimeke, however, said that there still exists tailbacks on LPG access, especially to the low-income households due to the high cost of appliances and the product.

In June, the Treasury is sought to delay the implementation of a 14 per cent value-added tax (VAT) on cooking gas by at least one year to prevent MPs from scrapping the new levy from a Bill that would become law on July 1.

This was line with the Finance Bill 2020 that has now removed cooking gas from tax-exempt goods with the new VAT charge in what is set to push it out of the reach of most households struggling with depressed incomes in the wake of Covid-19.