ISLAMABAD: Making new records, the government on Thursday increased the prices of all petroleum products, including liquid petroleum gas (LPG), by up to 17 per cent with immediate effect for the next 15 days.

With the fresh notification issued by the finance ministry, the prices of all petroleum products have set new records. It said the rates were raised due to an increase in international market prices and exchange rate losses.

Separately, the Oil and Gas Regulatory Authority (Ogra) announced an increase of about 17pc or Rs29 per kg in the price of LPG for the next month.

Surprisingly, Ogra announced on Thursday evening that the prices of petroleum products would be revised on Friday. “Petroleum prices will be announced tomorrow (Friday) by the government,” said an Ogra spokesman.

However, within an hour of the regulator’s announcement, the government notified the increase in prices of petroleum products.

According to the notification, the prices of petrol and high speed diesel (HSD) have been increased by Rs4 and Rs2 and those of kerosene and light diesel oil (LDO) by Rs7.05 and Rs8.82 per litre, respectively.

As such, the ex-depot price of petrol rose by 3.2pc to Rs127.30 per litre from Rs123.30. Petrol is mostly used in private transport, small vehicles, rickshaws and two-wheelers. This is the higher petrol rate in the country’s history.

The price of HSD was increased by 1.7pc to Rs122.04 per litre from Rs120.04. HSD price is considered highly inflationary as it is mostly used in heavy transport vehicles, trains and agricultural engines like trucks, buses, tractors, tube-wells and threshers. This is also the highest HSD rate for which record is publicly available.

The price of kerosene was raised to Rs99.31 per litre from Rs92.26, up by 7.64pc. Kerosene is mostly used by unscrupulous elements for mixing it with petrol and to some extent for lighting in very remote areas. This is the highest rate since September 2012 when it stood at Rs104 per litre.

The ex-depot price of LDO was increased to Rs99.51 per litre from Rs90.69, up by almost 10pc. LDO is consumed by flour mills and a couple of power plants. This is also the highest rate.

The petrol and HSD are two major products that generate most of revenue for the government because of their massive and yet growing consumption in the country.

Average petrol sales are touching 750,000 tonnes per month against the monthly consumption of around 800,000 tonnes of HSD. Sales of kerosene and LDO are generally less than 11,000 and 2,000 tonnes per month, respectively.

Under a mechanism, oil prices are revised by the government on a fortnightly basis to pass on international prices published in Platt’s Oilgram instead of previous mechanism of monthly calculations on the basis of import cost of Pakistan State Oil.

Published in Dawn, October 1st, 2021