Domestic LPG market to leapfrog in years ahead: Laugfs Gas
The domestic liquefied petroleum gas (LPG) market is expected to leapfrog in the years ahead, despite the setbacks faced by the industry during the time of recent economic and financial crisis in the country, Laugfs Gas PLC said.
While the consumers were increasingly conscious regarding their buying behaviour, a deviation from this trend is seen, as the domestic demand for LPG visibly expanded in the latter part of 2023, aided by Sri Lanka’s economic revival.
“This economic rebound was crucial, as it allowed households to resume their normal consumption patterns, with LPG emerging as a preferred choice for cooking.
The resurgence of the tourism sector and broad-based resumption of industrial activity also contributed towards higher demand towards the end of 2023,” said Laugfs Gas Group MD/ CEO Piyadasa Kudabalage said.
According to Laugfs Gas, the local industry has already made remarkable progress, post crisis, with the surge in demand, improving consumer confidence and restoration of stability of the global LPG value chain.
However, in the first half of the current financial year, the lingering effects of the 2022 economic crisis did challenge the entity. “Despite maintaining an uninterrupted supply of LPG, we struggled to reach the pre-crisis volumes, as the demand, especially from the retail segment, remained subdued almost until mid-2023,” said Kudabalage, noting this was largely because the customers continued using alternative energy solutions adopted during the previous year’s shortage.
Further, the practice of monthly price revisions for LPG along with the introduction of the Value Added Tax on LPG, which together resulted in considerable price volatility, also prompted the consumers to reassess their consumption behaviour, especially against the backdrop of lower disposable incomes, he shared.