ISLAMABAD: Due to “variation in oil prices in the international market”, the federal government has increased the petrol price by R3.72 per litre for the next 15 days, a notification by the finance division said on Saturday.
After the increase, the price of petrol rose to Rs252. “The Oil and Gas Regulatory Authority has worked out the consumer prices of petroleum prices, based on the price variation in the international market. It has accordingly been decided that the prices of petroleum products for the next fortnight starting from December 1…” the notification read.
Similarly, the price of high-speed diesel also witnessed an increase of Rs3.29 per litre, taking the per litre price to Rs258.43. On the other hand, the kerosene oil and light-diesel oil prices were reduced to Rs164.98 and Rs151.73, with respective cuts of Rs0.62 and Rs0.48. The price hike was contrary to expectations based on declining oil prices in the international market.
Petrol is widely used in motorbikes and cars and its demand had increased after the government cut off indigenous gas supplies to CNG retail outlets in Punjab several years ago. The widely consumed fuel in the country, however, is the high-speed diesel used in the transport and agriculture sectors. Its consumption, however, is low in December due to transportation limitations owing to severe fog in most parts of Punjab and northern Sindh. Still, the use of diesel in sugarcane areas increases due to the transportation of sugarcane to mills.
Currently, the government charges about Rs76 per litre tax on petrol and HSD. Although, the general sales tax (GST) is zero on all petroleum products, the government charges Rs60 per litre PDL (petroleum development levy) on both products that normally impact the masses. It also charges about Rs16 per litre custom duty on petrol and HSD, irrespective of their local production or imports. In addition, about Rs17 per litre distribution and sale margins are going to oil companies and their dealers. Petrol and HSD are the major revenue spinners with their monthly sales of about 700,000 — 800,000 tonnes per month compared to just 10,000 tonnes of monthly demand for kerosene.
On the other hand, the government charges Rs50 per litre on light-diesel oil and high-octane blending components and 95RON petrol used in luxury imported vehicles.
The government has nominally decreased the prices of LDO and kerosene oil. Kerosene oil is used in remote areas, especially the northern parts of the country where LPG is not available for cooking and heating. The Pakistan Army is also its key user in the northern parts due to cold weather.
Likewise, the Oil and Gas Regulatory Authority increased the price of liquefied petroleum gas (LPG) for December. The Ogra statement said that the LPG producer price is linked with Saudi Aramco-CP and the dollar exchange rate.
Compared to the previous month, Saudi Aramco-CP has remained unchanged but the average dollar rate increased slightly by 0.05 per cent, resulting in an increase in LPG consumer price by 11 paisas per kilogram, bringing the average rate of 11.8 kilogramme cylinder to Rs3,000.79 for December against Rs2,999.47 for November.
Published in Dawn, December 1st, 2024
