ISLAMABAD: Consumers are likely to face a hike of up to 10% in prices of petroleum products for August, 2019 following fluctuations in global crude prices.
The Oil and Gas Regulatory Authority (Ogra), in a summary forwarded on Tuesday, recommended the federal government to increase prices of petroleum products up to 10% for the month of August.
It made the recommendation after taking into consideration movement in crude oil prices in the international market.
The Ministry of Finance will review and set prices of petroleum products on Wednesday for August, 2019, keeping in view the government’s revenue collection target for the current fiscal year.
Ogra has calculated an increase of Rs5.15 per litre in the price of motor spirit (petrol), Rs5.65 per litre for high-speed diesel, Rs5.38 for kerosene oil and Rs8.90 for light diesel oil.
If the recommendation is approved, the price of petrol will jump to Rs117.83 per litre from the current Rs112.68, reflecting an increase of 5%.
POL prices remain unchanged for July
Similarly, with a hike of 5%, the high-speed diesel price will go up from the existing Rs126.82 to Rs132.47 per litre. High-speed diesel is mainly used in transport and agriculture sectors and an increase in its price will have a direct impact on the consumers.
According to Ogra's recommendation, the price of light diesel oil will go up 10% to Rs97.52 per litre from the current Rs88.62. The price of kerosene oil is expected to rise by Rs5.38 to Rs103.84 per litre.
Light diesel oil is mainly used for industrial purposes whereas kerosene oil is consumed in remote areas for cooking purposes where liquefied petroleum gas (LPG) is not readily available.
As in earlier instances, the government is likely to pass on a partial increase in oil prices by adjusting the rate of general sales tax (GST) and petroleum levy in order to absorb most of the recommended increase in prices, sources in the Petroleum Division said.
Ogra has calculated ex-refinery sale prices of petroleum products at the standard 17% GST.
Average price of crude oil imported by Pakistan State Oil (PSO) in previous three months (April-June 2019) is $65 per barrel. In its outlook for 2019-20, the World Bank has forecast that crude oil prices will hover around $67 per barrel.
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