Indicating that the international price of oil warranted an increase, the government on Wednesday, contrary to recent speculation, increased oil prices by up to Rs8.67 per litre – a 7.3% increase – effective March 1 (today).
The government also raised the price of Compressed Natural Gas (CNG) up to Rs1.77 per kilogramme due to a 20% increase in Gas Infrastructure Development Cess (GIDC). It will be the second time this month that the government has increased CNG prices.
However, there was no increase in the already sky-high price of High Speed Diesel (HSD) as the finance ministry has agreed to provide subsidy on High Speed Diesel (HSD) up to June 30. On the other hand, the government on Wednesday said that the provinces would be asked to share the burden of subsidy on other petroleum products if they wanted to provide relief to the consumers.
“The parliamentary panel will consult the political leadership and financial managers of all four provinces to contribute their share to the subsidy on other petroleum products, including petrol, Light Diesel Oil (LDO) and kerosene oil,” said Water and Power Minister Syed Naveed Qamar, who is also the chairman of the special committee on oil pricing.
The government and the PML-N had agreed on Tuesday to provide Rs15 billion subsidy on petroleum products over the next three months. However, at a closed-door meeting with a special four-member parliamentary panel at the parliament house, Qamar said that the federal government would not be able to bear the entire burden of subsidy on petroleum products for the next three months.
Adviser to Prime Minister on Finance and Revenue Dr Abdul Hafeez Shaikh had earlier stated that the committee subsidy on petroleum products would not only increase the fiscal deficit and worsen circular debt, but would also indirectly translate into higher inflation.
Price hike breakdown
According to a notification issued by the Oil and Gas Regulatory Authority (Ogra) on Wednesday, the price of CNG has been increased by Rs1.77 per kg to Rs77.12 per kg in Zone-1, which includes areas of Khyber-Pakhtunkhwa, Balochistan and the Potohar region (Rawalpindi, Islamabad and Gujarkhan) while prices were raised by Rs0.9 per kg to Rs71.05 per kg in Zone-2, which includes Sindh and Punjab (excluding the Potohar region).
The total increase in CNG price during month of February has been made Rs2.83 per kg in Zone-1 and Rs1.44 per kg in Zone-II.
The government has also increased the price of High Octane Blending Component (HOBC) by Rs8.67 per litre (7.3%), Petrol Rs2.75 per litre (2.9%), Light Diesel Oil (LDO) Rs3.08 per litre (3.4%) and kerosene oil by Rs4.38 per litre (4.8%) for the month of March due to hike in global oil prices.
Published in The Express Tribune, March 1st, 2012.
COMMENTS (13)
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the current situation suggest this: we should start using bicycles more and more. Pakistan is going back to the stone age where there will be no electricity, gas, petrol and CNG. the signs are already there.
The silence,tolerance and patience of Pakistani nation on the POL's prices hiking show and prove that Pakistani nation can easily afford petrol price up to 100+/liter and if PPP government is elected once again in next general elections then the nation has never to expect the POL's prices less than 100+/liter.
Wont pay taxes but want subsidy eh? Pakistan has one of the lowest tax base in the world, so where do you expect the subsidy money to come from? America??
Why is CNG expensive in Zone1 which contibutes to the production of Gas in pakistan, whereas the Zone2 has it cheap though its not producing any gas??
So that people say new govt is bad
Oh c'mon guys ... look at the brighter side ... all this extra money would be used by the goons, democratically elected by ALL OF YOU, and their families for Dubai and London shopping trips ... it is definitely going to further strengthen the democratic process in Pakistan !!!!
May I suggest a further increase in prices of CNG and petrol to a complete 100 Rs. ( seedha seedha hisaab ) so that general public doesn't have to wait for the change on stations and waste their precious time ?? see we care for people as " awaam taqat ka sirchashmaa hai " !!!!
Eat ... please eat the fruits of democracy !!!!!
good news is that diesel price forzen.
Why not make it free? Why can't you people stop crying and understand the fact that GLOBAL oil prices dictate what you and I will pay. Please check the price of gasoline, etc. in other countries and compare them with Pakistan. You will find that our prices are part of the norm.
If you want the government to subsidize your petrol, they will have to cut expenditure somewhere else. The problem with subsidies is just that.... a gain in one area will be a loss in another.
The better way to control oil prices is to cut demand, i.e. stop going out and burning petrol. Once we have tightened our belts, we can look at other factors and deal with them accordingly.
HOBC is not a "middle class" product by the way
Exactly, as the lower class is already dying. And the middle class is striving very hard. It’s no far when only the upper class will rule this country and we will start walking by foot. i can’t understand why they are not adopting other alternatives of fuels rapidly. All the new projects are remain always in planning stage but no execution. The natural gas resource is depleting, why not our Govt. looks for other options. As the rest of world do...But its Pakistan man and nothing will go to improve. The only solution that seems viable to our Govt. is just to escalate the prices. "It is the easiest way to kill poor Awam".
i wish Pakistan Aeronautical Complex with the help of Pakistani scientists should work in development of electric cars and other cheap mode of transportation.what poor people and middle class people going to do when petrol will be Rs.150 per liter by next year
Why not simply wipe out the middle class from the surface ??