Pakistan running out of gas: 12 kg LPG cylinder costs PKR 7000

Pakistan’s gas crisis is deepening as soaring liquefied petroleum gas (LPG) prices, declining domestic natural gas production and mounting sector debt put pressure on households and the energy supply chain. Disruptions to LPG imports from Iran have aggravated shortages ahead of winter, pushing cylinder prices sharply higher and forcing some families to turn to wood and coal for cooking. The strain comes as Pakistan grapples with PKR 5.454 trillion in gas-sector circular debt and outstanding payments to suppliers, even while facing difficulties managing surplus imported liquefied natural gas (LNG).

In Balochistan, a domestic LPG cylinder that previously cost around PKR 4,500 has risen to nearly PKR 7,000. Prices in some parts of the country have reached PKR 600 per kilogram, more than twice the official rate. The immediate supply disruption has exposed deeper structural problems, including declining output from domestic gas fields, growing dependence on imports and persistent financial liabilities across the sector.

LPG prices surge as Iran border closures disrupt supplies

LPG prices had already risen well above official levels before the latest supply disruption. Dawn reported on October 21, 2026, that prices had reached as much as PKR 600 per kg in hilly areas and PKR 500 per kg in Punjab and Khyber Pakhtunkhwa.


The Oil and Gas Regulatory Authority (OGRA) had set the official October price at around PKR 279 per kg. The notified price for an 11.8-kg domestic cylinder stood at PKR 3,296.23, highlighting the gap between regulated prices and what consumers were reportedly paying in the market.

The shortage worsened after key border crossings with Iran were closed. Reuters reported on October 23 that the closure of the Gabd-Rimdan and Taftan crossings had halted LPG imports from Iran, leaving tankers stranded and further constraining supplies.

Traders said Pakistan imported around 7,000 metric tonnes of LPG daily from Iran. In Balochistan, the price of a 12-kg cylinder climbed from approximately PKR 4,500 to PKR 7,000.

Pakistan cited security and anti-smuggling concerns behind the border closures, while Iran pointed to technical issues. The two countries were consulting on the resumption of trade.

Households turn to wood and coal as cooking fuel becomes expensive

The price surge has affected households already struggling with limited access to piped natural gas. In Rawalpindi and Islamabad, residents have reported receiving piped gas for only around six hours a day, while LPG prices have climbed to approximately PKR 600 per kg.

Dawn reported on October 26 that some households had begun using wood and coal for cooking as the cost and availability of conventional fuel became increasingly difficult to manage.

The situation illustrates how disruptions to imported supplies can quickly affect consumers when domestic production and piped-gas availability are already under pressure. As winter approaches, the combination of limited supply and high prices is adding to concerns over access to affordable household energy.

Pakistan’s domestic gas production falls nearly 20% in five years

The LPG shortage is unfolding against a longer-term decline in Pakistan’s domestic natural gas output. The Pakistan Institute of Development Economics (PIDE), a government-backed research institution, reported that production fell from 3,597 million cubic feet per day in financial year 2020 to 2,890 million cubic feet per day in FY2025.

That represents a decline of nearly 20% over five years. PIDE attributed the fall to the depletion of mature gas fields and a lack of new discoveries sufficient to replace declining output.

Lower domestic production has increased pressure on Pakistan to rely on imported fuels to meet its energy needs. However, imports do not necessarily provide a straightforward solution: the country has also faced a surplus of imported LNG that it cannot easily use or sell. This creates a mismatch between the fuel available through import arrangements and the supply that can be effectively absorbed by the domestic energy system.

The result is a complex energy problem in which consumers can face shortages and high prices even as imported fuel creates its own commercial and logistical challenges.

Gas-sector debt and unpaid supplier bills reach PKR 5.454 trillion

Pakistan’s supply difficulties are compounded by mounting financial liabilities across its gas sector. Business Recorder reported on October 20 that federal energy minister Ali Pervaiz Malik told the National Assembly that the sector’s total circular debt and outstanding payments to domestic gas and LNG suppliers stood at PKR 5.454 trillion as of June 30, 2026.

The amount comprised PKR 3.631 trillion in circular debt and a further PKR 1.823 trillion in outstanding payments to gas suppliers.

The minister said the circular debt included PKR 1.448 trillion in tariff differentials, PKR 131 billion in receivables from power companies, PKR 210 billion in sales and income tax receivables, and PKR 59 billion related to litigation.

Circular debt accumulates when payments are delayed or remain unpaid at different stages of the supply chain. When one entity does not receive money owed to it, it can struggle to meet its own obligations to producers, suppliers and other participants in the sector.

In Pakistan, tariff gaps, unpaid bills, delayed payments and the costs associated with imported fuel have contributed to this financial burden.

How the gas crisis affects supply and investment

The debt problem extends beyond the financial position of energy companies. When gas utilities struggle to recover the cost of supplying fuel, their ability to pay producers and maintain infrastructure can come under pressure. Delayed payments can also weaken incentives for investment in new production, particularly when existing fields are declining.

For consumers, the combined effect of falling domestic output, import disruptions and financial strain can mean higher prices, restricted availability or both. The recent LPG surge has brought these interconnected challenges into sharper focus.

Pakistan’s gas crisis is therefore not just a short-term shortage caused by border closures. The disruption has exposed the wider difficulty of maintaining affordable and reliable supplies while domestic production declines, import dependence grows and unpaid obligations accumulate across the energy sector.