Rising liquefied petroleum gas prices are pushing tea cafes across Karachi to switch back to coal as businesses struggle with soaring fuel costs and fierce competition that leaves little room to raise prices.
A survey found that dozens of tea cafes in areas including Gulistan-e-Johar, North Karachi and Federal B Area have returned to coal as a cheaper alternative to increasingly expensive LPG.
Cafe owners said the continued rise in LPG prices has made it difficult to sustain their businesses.
LPG prices in Pakistan have climbed sharply in recent months, while regional energy pressures have further strained the market. Higher fuel and shipping costs have increased operating expenses for small businesses that depend heavily on LPG.
The Oil and Gas Regulatory Authority increased LPG prices for August 2026 by Rs12.89 per kilogram, raising the price of an 11.8kg domestic cylinder by Rs152.01 from August 1.
The consumer price was fixed at Rs254,315.35 per tonne, or Rs3,000.92 per 11.8kg cylinder, compared with Rs241,432.84 per tonne and Rs2,848.91 per cylinder in July.
Cafe owners said customers have also responded positively to tea prepared on coal. Some said coal has once again become a necessity rather than just a preferred taste.
One owner in Gulshan-e-Iqbal said a 40-kilogram LPG cylinder now costs Rs14,000 and lasts about five days, while the same amount of coal costs around Rs5,000. He said this translates into monthly savings of about Rs54,000.
Another owner in Buffer Zone said intense competition has made it difficult to increase tea prices, so reducing costs has become the only way to protect profits.
An energy expert said fuel costs for tandoors, dhabas and small bakeries are rising faster than menu prices, leaving small food businesses with little room to absorb the shock.
He said many operators are coping by accepting thinner margins, cutting portions and, in some cases, reducing staff.
Industry stakeholders also linked the shift to coal with the limited number of LPG filling stations in the city.
The chairman of the LPG Distributors Association said the price increase is not only due to regional tensions but also to black marketing, a lack of proper filling stations and a flawed pricing formula.
He urged the government to revise the LPG pricing mechanism, saying the fuel is being sold in the black market at different rates.
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