The price of liquefied gas is rising in Kazakhstan – Ministry of Energy

The ministry noted that the need to use this measure is due to a number of reasons.

"Today, the price of liquefied petroleum gas is much lower than the cost of its production. Thus, the cost of CIS production varies from 60 to 70 thousand tenge per ton. While the maximum wholesale price for manufacturing plants is 40,320 tenge per ton. Thus, for every ton of gas produced, the plants suffer losses in the amount of 20-30 thousand tenge," the report says.

Also, a sharp increase in CIS consumption is observed year after year. Only last year, consumption in Kazakhstan increased by 400 thousand tons, or by 28% compared to 2022. So, in 2023, the CIS consumption volume was 2.2 million tons (1.8 million tons in 2022).

"In case of further suppression of CIS prices, Kazakh factories will not have the opportunity to increase production volumes to meet demand on the domestic market. As a result of unprofitability, factories increasingly lose interest in CIS production, switching to more profitable products. Investors are also reluctant to invest in the industry for similar reasons.

Kazakhstan has one of the lowest prices in the CIS – from 54 to 86 tenge. For comparison, in Russia, the price per liter of gas is 132 tenge, in Azerbaijan – 171 tenge, and in Tajikistan – 273 tenge," the Ministry of Energy said.

According to analysts' forecasts, already in 2024, the volume of consumption in the domestic market will increase by another 200 thousand tons and will amount to 2.4 million tons. At the same time, the gas deficit can be 30-40%.

At the same time, manufacturers repeatedly raised issues and appeals regarding price adjustments in order to maintain the level of liquefied gas production.

"Therefore, in order to prevent these risks from July 1 of this year. it is planned to adjust prices for liquefied petroleum gas. Thus, the maximum wholesale price per ton of liquefied petroleum gas will be KZT 45,158 (previously KZT 40,320). At the same time, the marginal retail price will increase slightly – from 5 to 8 tenge per liter, depending on the region.

The draft order is at the stage of public discussions," the agency noted.