This, as a consequence of the implementation of a rule that seeks to take pressure off the Fuel Price Stabilization Fund (FEPC), but “at the expense of generating a strong social demand, because it will increase the LPG price”, points out Arturo Vásquez, former vice minister of Energy.

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We refer to the published last January 20, which changes the methodology with which the reference price of bottled LPG is calculatedfuel on which seven million households depend to cook their food.

In essence, the rule states that the price of said energy will be calculated, from now on, “based on the import parity price (PPI)” and no longer “the export parity price (EPP)”explains the Peruvian Liquefied Gas Society (SPGL).

“So in the next 90 days there will be pressure on the price of LPG, even more so, taking into account that there are problems in the Panama Canal because there is a drought and the ships that transport LPG cannot pass economically,” adds Vásquez. .

This is an apparently minor change, but it has negative implications as it links the reference price of the bottled LPG to the Mont Belvieu marker (United States), instead of the port of Pisco “as has been happening until now”, specifies the SPGL.

And the bloody winter in the northern hemisphere (which fuels the demand for LPG for heating) has been driving the price of the Mont Belvieu marker and will continue to do so “until mid-April,” notes Vásquez.

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So in the next 90 days there will be pressure on the LPG price, even more so, taking into account that there are problems in the Panama Canal because there is a drought and the ships that transport the LPG cannot be done economically”, adds the specialist.

Price escalation

A direct consequence of all this is that the price of LPG cylinder of 10 kilos has increased by S/2 soles automatically in the last week.

And the prospects for the coming months are no better.

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In fact, Vásquez projects that the domestic gas bottle could become more expensive by up to S/5.5 after three months if the Government does not undo the provisions of DS 001-2024-EM.

It is a significant economic impact for the price to rise this way in 90 days. It will hit the economy of families and that will also drag down the cost of food, for example, the price of chicken, because there are thousands of industrial entities that use the LPG to produce, including poultry companies”, he points out.

To alleviate these negative impacts, the SPGL proposes that the Government refine the FEPC on “the basis of technical criteria and with the support of the industry“, for the purpose of “prevent the consumer from being affected by volatility in the international market”.

Controversial rule

And the regulatory analysis?

DS 001-2024-EM did not go through a public consultation stage and was not pre-published either.

Therefore, civil society, unions and specialists have not been able to comment or analyze it.

Arturo Vásquez proposes to review the norm “before a social problem is generated.”



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