ISLAMABAD: The government is likely to increase for next 16 days the prices of key petroleum products — petrol and high-speed diesel — by about Rs5 per litre on Friday, a senior official told Dawn on Thursday.

He said a working paper from the Oil & Gas Regulatory Authority (Ogra) had been received at the Ministry of Finance which worked out about Rs9-9.50 per litre increase in the price of petrol and HSD for Jan 16-31 period.

He said the impact of increase in oil price in international market over the last 15 days was about Rs3.50 per litre on petrol and about Rs2.10 per litre on HSD. On the other hand, petroleum levy on petrol and HSD at present is Rs22.85 per litre and Rs24.38 per litre.

The Ogra’s working on oil pricing is based on revised formula under ex-depot prices set on a fortnightly basis in line with prices published in Platt’s Oilgram instead of monthly calculations on the basis of import cost of Pakistan State Oil (PSO) at present.

These sources said the revised working is based on increased petroleum levy of Rs30 per litre for both HSD and petrol instead of existing rate of Rs24.38 per litre and Rs22.85 per litre, respectively.

The sources said the authorities were still divided over increasing the rate of petroleum levy. However, given the government plans to revive the IMF programme, the government would recoup a part of petroleum levy it had reduced in recent months but would not fully implement the Ogra’s working paper.

For avoiding rush on petrol pumps, Ogra spokesperson Imran Ghaznavi said in the afternoon the regulator had not forwarded any oil price computation to the government and warned that any speculation in the media could result in panic buying.

The government is charging about Rs42 per litre taxes on petrol and HSD. The government has already increased the general sales tax on all petroleum products to a standard rate of 17pc across the board to generate additional revenues. Until January last year, the government was charging 0.5pc GST on light diesel oil, 2pc on kerosene, 8pc on petrol and 13pc on HSD.

Published in Dawn, January 15th, 2021