ISLAMABAD.: The Pakistan Tehreek-e-Insaf (PTI) government on Wednesday silently dropped an oil bomb on the consumers by increasing petroleum products prices up to 10% weeks before the Eidul Azha.
Previously, the finance ministry used to issue statement regarding the oil prices revision. But this time around, the ministry remained silent and did not issue any statement until the wee hours of Thursday.
However, the ministry sent the new rates to the oil marketing companies for the month of August.
The Oil and Gas Regulatory Authority (Ogra) on Tuesday recommended to the federal government to jack up the prices by 10%, following fluctuation in global oil prices. The ministry expressed reluctance to pass on any partial impact to the consumers and instead decided to pass on full hike in oil prices to the consumers.
The Finance Division wants to collect more revenue from the consumers. Ogra had proposed an increase of Rs 5.15 per litre in motor spirit (MS), Rs 5.65 per litre in high speed diesel (HSD), Rs 5.38 in kerosene oil and Rs 8.90 per litre in light diesel oil (LDO).
Now, the price of petrol had jumped to Rs117.83 per litre from the Rs 112.68, reflecting an increase of 5%. With a similar 5% increase, the HSD price had also gone go up from Rs126.82 per litre to Rs132.47 per litre. HSD is used in the transport and the agriculture sectors and increase in its price will have direct impact on the consumers.
Similarly, the price of LDO had witnessed a hike of 10% to Rs 97.52 per litre from the Rs 88.62. The kerosene oil price registered an increase of Rs5.38 per litre to Rs103.84 per litre. The LDO is used in industry whereas kerosene is used in remote areas for cooking purpose where LPG is not available.
OGRA has calculated ex-refinery sale prices of petroleum products at standard 17pc GST. The average prices of previous three months (April to June 2019) of imported crude oil by Pakistan State Oil (PSO) is $65 per barrel.
In its outlook for 2019-20, the World Bank forecast the crude oil prices hovering around $67 per barrel. At present, government is charging 17% sales tax on all products.
The federal government is charging Rs18 per litre petroleum levy on HSD, Rs15 per litre on petrol, Rs6 per litre kerosene oil and Rs3 per litre on LDO.