ISLAMABAD: The care­taker government decided to keep the prices of petrol and high-speed diesel (HSD) unchanged for the first fortnight of the new year.

According to a statement issued by the finance ministry, the per-litre price of petrol will remain at Rs267.34 and that of HSD at Rs276.21 until mid-January.

The ministry said the government had left the prices unchanged on the recommendation of the Oil and Gas Regulatory Authority (Ogra).

The latest review shows that petrol and diesel prices increased by around Rs50 per litre during the year, as they stood at Rs214.8 and Rs227.8 per litre on Jan 1, 2023.

The calculations made by Ogra were largely based on a marginal increase in the prices of Brent crude and a slight drop in the Arab Gulf basket rates amid threats to shipping due to the Israeli war on Gaza.

An official of an oil marketing company (OMC) said that some tanker operators had stopped sending their vessels through the Red Sea to avoid the threat of drone and missile attacks in that region by the Houthi rebels of Yemen.

While the finance ministry has not announced the rates of kerosene and light diesel oil, sources in OMCs said the price of kerosene has dropped by Rs2.19 per litre to Rs188.83 but that of LDO has been increased by Rs1.19 to Rs165.83 per litre.

Apart from global oil prices, the exchange rate has been largely stable, too, with the rupee starting the outgoing fortnight at 283.26 per dollar and closing at 281.86 in the interbank market on Friday, the last trading day of the year.

Other key components affecting fuel prices are the petroleum development levy and general sales tax. Currently, the government charges Rs60 levy on a litre of petrol and high-speed diesel, while the GST is zero.

Meanwhile, an official of the Oil Companies Advisory Council (OCAC) said that January was one of the lowest fuel-consuming months in the country, as road transport suffered in the wake of low visibility due to fog and smog from Lahore to Sukkur areas.

However, the demand for kerosene increases in winter due to heating and cooking in remote areas, where LPG cylinders are not easily available.

Published in Dawn, January 1st, 2024