Propane prices surge in Uzbekistan as demand rises by 57%

According to Mirzamakhmudov, Uzbekistan's production of propane-butane has not grown substantially in 2024, reaching only around 850,000–860,000 tons, compared to just over 800,000 tons in previous years. He also pointed out that propane demand has surged, with the number of vehicles running on propane increasing by 57% over the past year.

"One of the main reasons for the price hike is the rise in propane-powered vehicles. Additionally, propane is supplied to the population at 1,600 UZS, which creates a gap compared to market prices," Mirzamakhmudov explained.

The minister highlighted that this price disparity has led to corrupt practices, where propane intended for households was being sold illegally. Authorities, in cooperation with the prosecutor's office, uncovered illegal sales of 14,500 tons of propane gas, a quantity originally meant for the public. This, according to Mirzamakhmudov, has contributed to market shortages and inflated prices.

He also discussed the challenges related to propane imports, stating that while the government had previously allowed private companies to handle imports without interference, they struggled to meet the demand. As a result, the state was forced to intervene.

Addressing concerns over supply fluctuations, Mirzamakhmudov noted that the government had maintained consistent volumes on the exchange, but there was a decrease in supply from May to September, due to reduced consumption. He acknowledged the issue raised by economist Otabek Bakirov, who mentioned that a single supplier was dominating the market, contributing to price volatility.

Bakirov also noted that the government was warned about potential price spikes by the Competition Committee as early as July, but the issue persisted. Responding to this, Mirzamakhmudov assured that the government has been working closely with the committee to address the issue.

The minister emphasized that by the end of the year, prices are expected to stabilize, stating that the current price of propane stands at 8.5 million UZS or approximately 5,500–6,000 UZS per liter.

However, Bakirov pointed out that placing blame on gas stations for the price hike is unjustified, as there is competition among them. "The real problem is the lack of competition at the top," he remarked.