ISLAMABAD: For a change, the prices of petroleum products may go down by up to Rs10.30 per litre for the next fortnight on Wednesday if the calculations of the Oil and Gas Regulatory Authority (Ogra) are accepted by the government.

Petroleum Division sources said the working paper on the prices of petroleum products from the Ogra had been delivered to the Ministry of Finance. The paper on pricing is based on existing petroleum levy and general sales tax rates, import parity price and commissions for dealers and OMCs.

According to the working paper, the regulator has calculated Rs10.30 and Rs8.65 per litre reduction in the ex-depot prices of petrol and high-speed diesel, respectively.

Petrol, diesel to carry extra Rs1.70 and Rs1.54 charge

However, a senior official told Dawn that the finance ministry was working on a revised paper in consultation with the Petroleum Division to add an additional charge of Rs1.70 and Rs1.54 on petrol and diesel, respectively, on account of increase in commission for dealers and oil marketing companies under an agreement reached early this month.

Therefore, the ex-depot price of petrol and diesel were estimated to come down by Rs8.60 and Rs7.10 per litre, respectively.

Officials said the prices of petroleum products would have seen greater reduction but the impact of decline in international market was partially offset by devaluation of the rupee during the last fortnight.

It would be the first price cut after Sept 1 when the price of petrol and HSD stood at Rs118.30 and Rs115.03 per litre respectively. The prices have since been going up soaring to Rs145.82 for petrol and Rs142.62 per litre for diesel.

As of now, the government is charging Rs2.34 per litre general sales tax on petrol and Rs9.80 per litre on diesel. It is also charging Rs13.62 per litre petroleum levy on petrol and Rs13.15 per litre on diesel. In addition, Rs11.33 per litre customs/deemed duty on petrol and Rs10.45 per litre on are diesel being collected.

As such, the government’s per litre revenue on petrol works out at Rs27.30 per litre and Rs33.38 per litre on HSD at present.

The government has given an undertaking to the International Monetary Fund to increase petroleum levy on both petrol and HSD by Rs4 per litre every month to attain Rs30 per litre maximum permissible under the law. Until last year, the government used to charge up to Rs30 per litre petroleum levy on HSD and petrol and Rs6-8 per litre on kerosene and light diesel.

Published in Dawn, December 15th, 2021