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ISLAMABAD: As the Middle East crude oil price dipped to $47 a barrel, the Oil and Gas Regulatory Authority (Ogra) recommended on Thursday more than 10 per cent reduction in prices of petroleum products for the month of February.
The reduction would bring the prices of the products to their lowest levels in more than 15 years, said a former senior official of the petroleum ministry, adding “let us expect its benefits to reach the public”. Last month, the government had increased general sales tax on oil products by 5 per cent to curtail GST loss.
Ogra forwarded on Thursday a summary to the ministries of petroleum and finance on its recommendation.
Also read: ‘Oil price may fall to $25’
It suggested about 10 per cent reduction in the price of high speed diesel, 13.73 per cent in petrol, about 18 per cent in kerosene oil, 17.5 per cent in light diesel oil and 16 per cent in High Octane Blending Component (HOBC).
The acceptance of the proposal would for the first time make compressed natural gas (CNG) costlier than petrol by Rs9 per kg in Khyber-Pakhtunkhwa and Rs4.50 per kg in Sindh and Punjab, an official said.
According to Ogra’s working paper, the ex-depot price of petrol (motor spirit) would come down by Rs10.75 per litre to Rs67.53 from Rs78.28 litre.
The ex-depot rate of high speed diesel would come down by Rs8.80 per litre to Rs77.43.
The price of HOBC for depots would be reduced by Rs14.85 per litre to Rs77.15 in various cities.
Kerosene used by households in remote regions of the country for cooking, heating and lighting has been worked out at Rs59 per litre — down by Rs12.92 from the current price of Rs71.92.
The new ex-depot price for light diesel oil would be Rs55.66 per litre, down by Rs11.84.
Apart from Rs6 to Rs14 per litre petroleum levy, the government also charges 22 per cent general sales tax on prices of oil products.
The general sales tax on petroleum products fixed by the government at 17 per cent in the budget, was increased by five per cent last month through a statutory regulator order of the Federal Board of Revenue (FBR).
Published in Dawn, January 30th, 2015
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