ISLAMABAD, Sept 27: The federal government is expected to make a ‘sizeable’ increase in the prices of petroleum products on Friday. A senior official told Dawn that the government would resume its “strategy of absorbing some and passing on some to consumers” because the revenue loss was getting unbearable for the government.

He said the government had picked up a revenue loss of Rs1.7 billion in the current fortnight by not increasing prices on Sept 15.

During the first three months of the current fiscal year, the revenue loss soared to Rs10.5 billion. He said the government had lost Rs68.5 billion since May 2004.

He said the prices of motor spirit (petrol) had increased by 60 per cent in the international market since last year, but the government had increased its prices by 42 per cent only.

Similarly, the prices of kerosene oil had gone up by 83 per cent in the international market over the last one year, but its prices in the country had registered a 29 per cent increase only. The prices of diesel had been raised by 88 per cent in the last one year, but its increase in Pakistan stood at 42 per cent.

He said the average petrol prices in four major cities of India stood at Rs64 per litre compared with Rs52 per litre in Pakistan.

The official said the government had so far absorbed major shock of price increase and passed on only a small portion to consumers, but the time had come to create a ‘balance’.

He said the government had decided to absorb a part of increase in international oil prices and pass on to consumers some of the additional burden ‘which was now going out of control’.

He, however, clarified that the full impact of international market would not be passed on to consumers.