In the aftermath of the Saudi Aramco Drone attack that took place in September, there is an understandable shortage of LP gas in the market. The current status of the LPG shortage could be attributed to a number of convolving factors.

First of all, in September there was a drop in LPG demand while the price formula was being finalized as the market anticipated a price reduction. Demand surged following the price reduction upon finalizing the price formula. Secondly, the drone attack that took place in mid-September at Saudi Aramco oil processing facilities at Abqaiq and Khurais in eastern Saudi Arabia triggered a delay in shipments to several markets globally, including Sri Lanka. Thirdly, a new segment of consumers entered the market, tempted by the low price of LPG at just Rs Rs.1,493. The current price in fact is the lowest experienced within the past few years.  In 2016, the price of a 12.5kg LPG cylinder reduced to Rs 1,321.

The current status quo continues to impact LPG industry in the country at different levels of intensity, driven by different causes. As a result of the shortage experienced by Litro’s competitor, a significant number of consumers switched to Litro, further increasing the demand for Litro LPG. 

 Lastly, the prevailing bad weather conditions continue to pose challenges to vessels trying to reach the two bunkering facilities of Litro Gas further aggravating the situation. Off-shore unloading too slowed down severely to the extent that there are vessels waiting in-line to be unloaded off-shore. 

The apparent shortage resulted in a ‘panic-buying mode’ within a cross section of consumers, increasing the average demand to 1,300MT from 900 – 950MT, putting further pressure on the entire logistics process.
However, Litro Gas Lanka is efficiently and knowledgably working to resolve the current situation to continue to supply the required amount of LP gas cylinders to the market undeterred by challenges.