LPG Crisis: Pakistan’s Energy Security Exposed as Demand Set to Outpace Supply

Pakistan’s energy security is facing growing pressure as regional instability and volatility in global energy markets push up prices and expose weaknesses in the country’s supply system.

The ongoing conflict has highlighted the fragility of Pakistan’s energy security and the need for comprehensive, integrated planning.

The current liquefied petroleum gas (LPG) crisis is partly linked to border closures. However, it has also exposed deeper problems in the sustainability of the domestic market. LPG demand continues to rise, while local production remains insufficient and infrastructure faces major shortcomings.

According to Petroleum Division documents available with Dunya News, more than 10 million households in Pakistan are connected to the natural gas pipeline network. More than 25 million households rely on LPG and other fuels to meet their energy needs.

Population growth and declining domestic natural gas production are driving demand for LPG. Pakistan’s annual LPG market currently stands at approximately 2.4 million metric tonnes.

The market has grown by an average of 7.5 per cent annually over the past six years. Demand is projected to increase by another 8 to 8.5 per cent each year in the coming years.

LPG demand stood at 2.4 million metric tonnes in fiscal year 2025-26. It is projected to reach 4.16 million metric tonnes by FY2032-33.

Domestic production, however, is expected to increase only marginally, from 0.96 million metric tonnes to 1.35 million metric tonnes over the same period.

This widening supply gap will increase Pakistan’s dependence on imports. LPG imports are projected to rise from 1.4 million metric tonnes to 2.8 million metric tonnes by 2033.

The country’s existing LPG infrastructure also faces serious safety and capacity concerns.

Inspections by the Oil and Gas Regulatory Authority (OGRA) and the Hydrocarbon Development Institute of Pakistan (HDIP) found no quality-testing facilities at any land entry point in Taftan.

Several explosions have also occurred since 2020 during the transfer of LPG between tankers at border crossings, where adequate safety arrangements were missing.

The documents estimate that 56 per cent of LPG transportation bowsers operating in Pakistan are unregistered, raising further concerns about regulatory oversight and safety.

Pakistan’s total LPG storage capacity stands at approximately 70,000 metric tonnes. Of this, 14,000 metric tonnes are located at seaports, while inland facilities account for 56,000 metric tonnes.

The available storage capacity is insufficient to meet the country’s growing energy requirements.

The two existing LPG terminals at Port Qasim each have storage capacity of around 6,500 metric tonnes. They can accommodate vessels of up to 10,000 deadweight tonnes (DWT).

This capacity is considerably lower than international standards, where LPG vessels typically range from 30,000 to 50,000 DWT.

The ports also lack additional storage facilities, while Pakistan has no inland pipeline network for LPG transportation. As a result, sea-based LPG imports account for only 16 per cent of the country’s total supply.

The Petroleum Division documents warn that meeting projected LPG demand by FY2035-36 will require substantial investment.

Key priorities include expanding import terminals and storage capacity, improving cylinder-filling facilities and strengthening transportation infrastructure.

Without improvements in domestic production, storage, safety standards and supply networks, Pakistan’s growing dependence on LPG imports could leave its energy market increasingly vulnerable to regional disruptions and international price fluctuations.