ISLAMABAD, Aug 2: Although the Oil and Gas Regulatory Authority (Ogra) has proposed a seven per cent decrease in domestic oil prices, the coalition government, it seems, is reluctant to pass on this benefit to consumers.

The Ogra recommendation came in the wake of a recent decline in oil prices in the international market to $126 per barrel from an all-time high price of $147, but the decrease in oil prices is yet to be passed on to consumers.

“Owing to a recent downward trend in international petroleum prices, we recommend seven per cent decrease in the POL products to the government,” Ogra Chairman Munir Ahmad informed Senate Standing Committee on Petroleum and Natural Resources here on Saturday.

He, however, said that the benefit could not be passed on to consumers immediately as the government is adjusting the price differential claim (PDC) after which the public is expected to have this its benefit.

Besides a decrease in oil prices, the government in recent amendments to pricing formula also helped save an average Rs4.30 per litre, but the same was also not being passed on to consumers.

Repeated increases in domestic oil prices helped the oil marketing firms and dealers to make windfall gains because of rise in international prices.

The committee recommended that after a recent decrease in prices, a downward revision in oil prices had become necessary.

Presided over by Senator Syed Dilawar Abbas, the committee asked Ogra to carefully work out overheads and other allied expenditures of CNG stations to determine precisely the extent of profit they are making.

The meeting was informed that the SNGPL and SSGPL are providing gas to these stations at a much lower price -- SNGPL at Rs22.16 per kg and SSGPL at Rs20.35 per kg, respectively, inclusive of sales tax, but the people are getting CNG at more than double of this cost.

The ministry of petroleum was asked to monitor the LPG situation as there may be a similar crisis in winter this year.

It also recommended that the demand and supply gap in LPG sector be bridged through imports so that consumers’ interests could be safeguarded.

The senate body instructed the OGDC to operationalise expeditiously the two gas fields which have been facing problems for some time to overcome the shortage.

It also instructed the corporation to intensify efforts for increasing the domestic production of oil and gas by gearing up exploratory activities.

The members of the committee urged the ministry of petroleum to expedite commissioning of more CNG stations for Balochistan, which is providing gas to whole of the country but surprisingly has only four CNG stations for itself.

It instructed Ogra to process the remaining 27 applications expeditiously for setting up these stations as people were facing hardships.

The Ogra chairman informed the committee that the caretaker government had imposed a ban on new CNG stations as a result of which cases of the remaining applicants could not be processed.

The committee recommended immediate lifting of the ban so that the province could get its due share of CNG stations.

The SNGPL managing director informed the meeting that a new gas pipeline was being laid for Quetta city to overcome shortages which would be operational by November this year.

The committee urged the government to hand over the issue of price determination of the CNG and LPG to Ogra to avoid what had happened in the first week of July in the aftermath of CNG price increase by the government, whereby people were robbed of millions of rupees by the clever market manipulators in a couple of days.