KARACHI, Feb 28: The Oil Companies Advisory Committee (OCAC) has increased the petrol price by Rs1.57, to Rs43.96 from Rs42.39 per litre, while oil marketing companies (OMCs) have raised the price of high speed diesel (HSD) by Rs1.05, to Rs28.21 from Rs27.16 per litre.

The OCAC has also enhanced the price of high octane blending component (HOBC) by Rs1.62, to Rs48.94 from Rs47.32 per litre. The prices of kerosene oil and light diesel oil (LDO) have been increased to Rs27.98 and Rs25.37, from Rs27.04 and Rs24.33 per litre respectively.

The new prices will be effective from March 1 to 15, 2005. The committee, in a statement, said that the oil prices in the international market in the second fortnight of February had soared due to factors such as increase in demand in the US and China, OPEC production control and some geo-political issues. The average price of oil products in the Arab Gulf had increased by four to eight per cent.

The OCAC had not mentioned the mean price for oil in Arab Gulf on the basis of which the prices had been changed for the current fortnight. Even the rupee-dollar parity rates had not been mentioned.

The committee, a strong cartel of OMCs, had kept the price of POL products frozen from May 15, 2004, to December 15, 2004, on instructions of the government in order to offset the impact of rising international oil prices on end-users that might have fuelled the inflation. During the period, the government faced a revenue loss of Rs40 billion by bringing the petroleum development levy (PDL) to zero.

On January 1, 2004, petrol was available at Rs33.78 while diesel and kerosene were selling at Rs22.78 and Rs22.38 per litre. When the domestic prices had been capped on May 15, 2004, petrol, diesel and kerosene were available at Rs36.92, Rs24.37 and Rs24.00 per litre.

In effect, petrol has become dearer by Rs10.18 per litre over the last 14 months (from January 1, 2004, to February 1, 2005), while diesel price has gone up by Rs5.43 per litre. Kerosene has become costlier by Rs5.06 per litre during the period.