Govt ‘surprises’ consumers with hike in petrol and diesel rates

Experts were hoping that the prices of petroleum products would go down, but the government increased the rates to offset inventory losses incurred by oil companies after the last price revision on October 15.—Dawn/file

ISLAMABAD: Despite a decline in the international market, the government has increased the prices of petrol and high-speed diesel (HSD) for the next fortnight.
The move came as a surprise as experts were hoping for a reduction in the prices of petroleum products.
According to an official announcement on Thursday, the price of petrol will go up by Rs1.35 and that of diesel by Rs3.85 per litre.
Until November 15, the ex-depot petrol price will be Rs248.38 per litre, up from Rs247.03, and diesel Rs255.14 per litre, up from Rs251.29.
The prices of light diesel and kerosene have been reduced by Rs2.61 and Rs1.48 per litre, respectively.
In the late-night annou­ncement, the Ministry of Finance said the petroleum regulator, Ogra, had worked out the prices based on the variations in the international market.
However, sources said the government had retained a part of the increase in rates due on October 15, hoping that the following quarter would be cheaper.
However, this resulted in inventory losses to the oil companies, which also protested against the government.
The international prices subsequently came down, but the backlog was on the higher side, forcing the government to increase the prices for the next 15 days.
The average prices of petrol and HSD decreased in the international market by about $1.5 and $2.5 per barrel, respectively, after October 15.
The average price of petrol had dropped to about $76 per barrel from about $77.5. The price of HSD also declined to about $84 per barrel from $86.5 in the last fortnight.
During the current fortnight, the import premium on both petrol and HSD remained generally stable at $8.7 and $5 per barrel, respectively. The exchange rate also stood its ground.
At present, the government is charging about Rs76 per litre tax on both petrol and HSD. However, the general sales tax is zero on all petroleum products.
Additionally, the government is charging Rs60 per litre petroleum development levy on both products that normally impact the masses. It also charges about Rs16 per litre as customs 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.
LPG prices
The Oil and Gas Regulatory Authority (Ogra) has increased the price of liquid petroleum gas (LPG) by about Rs2.88 per kg for the month of November.
The new price for an 11.8kg cylinder will be Rs2,999.47 in November, compared to Rs2,965.38 in September.
According to Ogra, the LPG producer price was linked with Saudi Aramco-CP and the US dollar exchange rate.
As compared to the previous month, the Saudi Aramco-CP has increased by 1.6pc while the average dollar exchange rate slig­htly decreased by 0.19pc, resulting in an increase in the LPG consumer price by Rs34.09 per 11.8kg. The per kg increase is Rs2.88, it said.
Published in Dawn, November 1st, 2024