Petroleum prices likely to go up by Rs15

After offering relief to consumers in the last three revisions of oil prices, the government is now likely to raise the prices of high-speed diesel (HSD) and petrol by Rs9.84 per liter and Rs7.54 per liter, respectively, for the next fortnight starting from July 1.

This possible increase is attributed to fluctuations in global oil prices. The government also plans to increase the rate of petroleum levy on these two products. If the government increases the rate of petroleum levy by Rs5, the price of petrol may go up by Rs12.54 and HSD by Rs14.84 per liter.

The government is currently charging Rs60 per liter petroleum levy on petrol and diesel. HSD is widely used in transport and agriculture sectors. Therefore, an increase in its price will have inflationary effects on consumers. Consumers have been enjoying relief due to cuts in the prices of petroleum products.

According to oil marketing companies’ estimates, the ex-depot price of petrol is likely to go up from Rs258.16 to Rs265.70 per liter, and HSD’s price would go up from Rs267.89 to Rs277.73 per liter. These calculations are based on current government taxes and margins.

The government is charging Rs60 per liter petroleum levy on petrol and HSD, whereas they are exempt from the general sales tax (GST). In case the government decides to raise the levy on both petrol and HSD by Rs5 per liter, the prices of petrol and HSD would go up further by Rs12.54 and Rs14.84 per liter, respectively.

Meanwhile, ahead of the possible hike in prices of petroleum products, oil marketing companies have halted the supply of fuel in Punjab.

According to Petroleum Dealers Association Secretary Khawaja Atif, not a single oil tanker has reached petrol pumps across Punjab, including its provincial capital, for the past four days.

“Despite charging millions of rupees in advance, oil marketing companies are not providing us fuel. The lack of petroleum supply could lead to an oil crisis as most petrol pumps in the city have enough oil until tomorrow [Friday],” Atif added.

He said if supply does not resume by Friday, petrol pumps across Lahore and Punjab will be closed. “Oil marketing companies have emptied oil tankers filled with petrol,” he added.

However, Oil Marketing Association Chairman Tariq Wazir Ali rejected the claim that companies are not supplying fuel, passing the buck to oil refineries.

“If the oil refineries are not providing oil, how can the oil companies supply it to the dealers? We have written to OGRA to ensure timely supply of petroleum products,” Ali added. (WITH INPUT FROM OUR CORRESPONDENT IN LAHORE)