Pakistan RLNG Prices Cut About 20% After Cheaper Qatar Cargoes

ISLAMABAD: Pakistan's energy regulator has reduced regasified liquefied natural gas prices by around 20 per cent for September after cheaper cargoes from Qatar lowered the cost of imported fuel supplied through the country's two major gas distribution companies. The revised rates represent a sharp decline from recent months, when international supply disruptions had pushed imported gas costs considerably higher.

The latest pricing notification shows that September LNG cargoes were delivered at an average ex-ship price of $10.06 per million British thermal units. That compares with $12.12 per mmBtu in August and $18.96 per mmBtu in July, when Pakistan had to secure more expensive supplies from the international spot market amid disruptions linked to the conflict involving the United States and Iran.

For Sui Northern Gas Pipelines Limited, which supplies Punjab and Khyber Pakhtunkhwa, the RLNG price at the transmission stage fell by 19.99 per cent to $13.99 per mmBtu from $17.49 in August. At the distribution stage, the rate declined by just over 20 per cent to $15.196 per mmBtu, compared with $19.02 during the previous month.

Consumers supplied through Sui Southern Gas Company Limited, covering Sindh and Balochistan, also saw substantial reductions in the calculated rates. The transmission-stage price dropped by 21.53 per cent to $12.611 per mmBtu from $16.07, while the distribution-stage price fell by 21.57 per cent to $14.22 per mmBtu from $18.13 in August.

Despite the fall in the underlying cost of imported LNG, expenses added after cargoes reach Pakistan continue to keep final RLNG prices above the delivered cost. Importers and port-related entities charge margins and retainage, while transmission and distribution losses further increase the amount ultimately incorporated into consumer-facing calculations. System losses were reported at nearly 9 per cent for the northern network and 12.55 per cent for the southern network.

The lower September rates are particularly significant for Pakistan's power sector because RLNG is used as a fuel for electricity generation. A reduction in imported gas costs can lower fuel expenses for plants relying on the commodity, although the eventual effect on electricity charges depends on broader generation costs, regulatory calculations and the overall energy mix during the billing period.

The September reduction also highlights how quickly Pakistan's imported energy bill can change with international market conditions and cargo procurement costs. July's elevated prices reflected emergency purchases during a period of supply disruption, while the cheaper Qatar cargoes secured for September have produced a substantial reversal. Future monthly RLNG rates will continue to depend on cargo prices, supply availability, exchange-rate effects and costs added across the domestic gas network.