ISLAMABAD, Oct 13: The government on Friday hinted that it had dropped plans to reduce oil prices despite 25 per cent decline in international oil market because of uncertain future price forecast.
It was a misperception that any decline in international oil prices would immediately result in reduction in domestic petroleum rates, Minister of State for Information Tariq Azeem said at a press conference. He said that the oil prices were likely to go up in the wake of production cuts by Opec member countries.
Assisted by secretary petroleum Ahmad Waqar and economic adviser to the finance ministry Dr Ashfaq Hassan, Mr Azim claimed the government had provided a subsidy of Rs83 billion on oil prices since May 2004. However, neither of the three officials could offer any justification when asked why budget documents of the past two years did not substantiate this amount.
The official budget-in-brief explains in details all subsidies that are provided to the people during a fiscal year. According the documents, the government provided Rs11.8 billion subsidy on oil pricing during fiscal 2004-05 and Rs8.196 billion in 2005-06, making a total of Rs19.99 billion.
None of the three speakers clearly said that oil prices would not be reduced, but the defence they put up for maintaining higher rates despite international decline suggested that the prices would not be reduced after two days.
It was a unique press conference in the sense that most questions raised by journalists remained unanswered as the minister of state for information read out a written statement and his colleagues struggled to give answers.
Secretary petroleum Ahmad Waqar, however, said that if the prices remained at the current level it would take about three months before the current amount of petroleum differential claims was adjusted.
Sources said that Prime Minister Shaukat Aziz had rejected a petroleum ministry’s summary that proposed a 65-paisa per litre reduction in diesel prices on the ground that oil situation was not certain in the immediate future and it would be difficult ahead of elections to raise prices again in case of international spike.
