Govt uncaps POL prices after seven months

Petrol dearer by Rs2 and HSD by Rs2.70 per litre

ISLAMABAD: The government has increased the prices of petrol and high speed diesel (HSD) for the month of December. It, however, kept the prices of kerosene and light diesel unchanged.

The hike in prices was announced by Finance Minister Ishaq Dar who said that the government would borne the brunt of Rs4 billion revenue losses by passing on to consumers less than the increase recommended by the Oil and Gas Regulatory Authority (Ogra).

According to the announcement, per litre price of petrol has gone up by Rs2, while the price of high speed diesel (HSD) has witnessed a hike of Rs2.70 for the month of December.

Ogra and the Ministry of Petroleum & Natural Resources had recommended an increase in prices by 6.24% in MS 92 RON (petrol), 7.47% in HSD and 6.49% in kerosene with effect from December 1, 2016.



The increase recommended by Ogra was Rs4.01/litre in MS 92 RON, Rs5.42/litre in HSD and Rs2.81/litre in kerosene. However, the government has maintained the prices of kerosene and light diesel at the current level for the month of December.

Addressing a press conference, the finance minister said: “In order to maintain stability, oil prices have been maintained at the current level since April 2016 despite fluctuations in the international market, and the government was absorbing the financial cost as the impact of increase in POL prices was not passed on to end consumers.”

“The government has decided to provide maximum relief to the underprivileged. That is why it has been decided to maintain the prices of kerosene and light diesel at the current level for the month of December 2016.”

The Economic Coordination Committee (ECC) of the cabinet in its August 18, 2016 meeting had decided to switch from the existing 87 RON to 92 RON with effect from November 2016 to ensure improved quality product for end users.

Petrol 92 RON is of a much higher quality and Ogra’s proposed price reflects increase in international oil prices as well as the premium for a higher quality product.

Published in The Express Tribune, December 1^st, 2016.