ISLAMABAD: Despite a hike in the global market, the government on Friday decided to keep oil prices unchanged for October 2016.
The decision was taken at a time when Imran Khan-led Pakistan Tehreek-e-Insaf (PTI) launched a march towards Raiwind, near the family residence of Prime Minister Nawaz Sharif in Lahore.
Owing to the static petroleum product prices, the government will bear a revenue loss of Rs2 billion in October.
Earlier, in line with the rise in global crude prices, the Oil and Gas Regulatory Authority (Ogra) had prepared a summary, recommending an increase of up to 6.3% in prices of petroleum products, except for high-speed diesel, for October 2016.
Prices of all petroleum products, except for kerosene oil, are deregulated and Ogra only monitors their movement.
The government has the capability to absorb the impact of proposed increase in oil prices by adjusting the rates of taxes on petroleum products.
Despite a decline of over 50% in global prices over the past two years, consumers have largely been denied a full relief in previous months because of hefty taxes to avoid revenue loss to the government.
At present, two types of taxes are being collected from the oil consumers including petroleum levy and general sales tax. The government will adjust the proposed upward revision in oil prices in the tax rates.
High-speed diesel, which is mostly used in transport and agriculture sectors, will be sold at the existing price of Rs72.52 per litre in October, while petrol price will stand at Rs64.27 per litre.
The price of kerosene oil, used for cooking in remote areas where liquefied petroleum gas is not readily available, has been left unchanged at Rs43.25 per litre.
Similarly, light diesel oil, mainly used for industrial purposes, will be sold at the existing price of Rs43.34 per litre. The price of high octane blending component, mostly used in luxury cars, has been kept unchanged at Rs72.58 per litre.
Published in The Express Tribune, October 1st, 2016.