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Petrol and CNG prices increased

September 23, 2012

ISLAMABAD, Sept 23: The government increased with immediate effect prices of petrol and compressed natural gas (CNG), but reduced the rates of diesel, kerosene and jet fuels.

The new prices announced on Sunday will remain in place for a week.

The prices of petrol and CNG were increased by a uniform rate of 1.62 per cent to maintain 60 per cent price parity between the two competing fuels in the private and small transport category.

The petrol price was jacked up by Rs1.73 per litre from Rs106.72 to touch a new record at Rs108.45 per litre.

Similarly, CNG price for region-1 comprising Balochistan, Khyber Pakhtunkhwa and Potohar was increased by Rs1.59 per kilogram from Rs97.69 to Rs99.28 per kg, highest ever rate since CNG was introduced as transport fuel more than 15 years ago.

The CNG rate for region-2 comprising Sindh and Punjab was jacked up from Rs89.25 per kg to Rs90.70, up by Rs1.45 per kg.

On the positive side, diesel prices continued to slide for the second week albeit at a nominal pace.

The high speed diesel, mostly used in agriculture tube-wells and public and freight transport, dropped by 0.41 per cent to Rs113.30 from Rs113.77 per litre.

Light diesel oil came down by 2.1 per cent to Rs97.17 per litre from Rs99.27.

Kerosene oil, mostly used for cooking and heating in rural areas, dropped Rs3.05 per litre to Rs101.63.

The price of high octane blending component posted the highest reduction of Rs6.06 per litre or 4.4 per cent but has a negligible impact on consumers.

The new price for HOBC was reduced to Rs131.90 per litre from Rs137.96. The prices of three aviation fuels were also reduced.

The price of JP-1 was reduced by 3.23 per cent to Rs91.21 per litre to Rs82.68 per litre from Rs86.37 and of JP-8 by 3.24 per cent to Rs90.90 per litre.

Officials said the prices of diesel, petrol, HOBC and light diesel had been deregulated by the government and hence price changes were affected by the oil marketing companies at their own once they were conveyed that there was no change in petroleum levy by the government.

The government is charging a maximum petroleum levy permissible under the finance bill at the rate of Rs10 per litre on petrol, Rs14 on HOBC, Rs6 on kerosene and Rs8 on HSD.

In addition, the government also collects 16 per cent GST on all products.

An official said the prices of petroleum products might come down next week as a result of last week’s $3 per barrel reduction in benchmark crude price in the international market.

The government passed on the impact of fluctuation in the international market to consumers but ignored repeated recommendations of parliamentary committees to bring prices back to the pre-August position by lowering its Rs6-14 per litre revenue take as petroleum levy to absorb additional hit to consumers.

The National Assembly’s standing committee has already warned the ministries of petroleum and finance of a privilege motion against them for not acting on its proposals and has called a special meeting on Sept 27 on the issue.

But the government decided not to change the rate of petroleum levy on petroleum products. As a result, OMCs had to pass on the impact of fluctuation in international prices along with maximum petroleum levy permissible under the finance bill in addition to 16 per cent GST.