No new year reprieve?: Consumers to face hike in oil prices

Govt will announce prices today after PM’s approval.

ISLAMABAD:

Consumers are likely to face a hike in oil prices, as fluctuations in global oil prices will cause an increase of Rs2.91 per litre effective from January 1.

However, in a summary moved by the Oil and Gas Regulatory Authority (Ogra) to the petroleum and finance ministries on Monday, Ogra proposed not to pass on the increase in oil prices by adjusting the rate of the Petroleum Levy (PL) on petroleum products to provide relief to consumers. Officials said that consumers would be facing an increase in inflation if the government raised oil prices on January 1, 2014.

Officials also said that the finance ministry may oppose Ogra’s proposal as its priority is increased revenue collection. However, the final decision will be taken by the prime minister.

The federal government will announce the new prices today (Tuesday) after approval from Prime Minister Nawaz Sharif.

According to a summary, the consumers of High Speed Diesel (HSD), which is used mostly in the transport and agriculture sectors, may face an increase of Rs2.63 per litre, which will bring its price up to Rs119.38 from the existing R116.75 per litre.

The price of petrol may go up by Rs2.91 per litre from the current Rs112.76, to Rs115.67 per litre. “At present, CNG is not available in Punjab and the hike in petrol prices would provide an opportunity to oil marketing companies and dealers to make extra profits due to increase in sale volumes,” officials said.

Kerosene oil, which is used for cooking purposes in remote areas where Liquefied Petroleum Gas (LPG) is not readily available, may witness a hike of Rs1.38 per litre, bringing its price up to 109.38 from the existing price of Rs108 per litre.

The price of Light Diesel Oil (LDO), which is used mainly for industrial purposes, may witness an increase of Rs1.80 per litre, bringing the price to Rs103.04 per litre from the current price of Rs101.24.

The price of High Octane Blending Component (HOBC), used mainly in luxury cars, may increase by Rs3.60 per litre to Rs144.83 per litre, from the existing Rs141.23.

The price of JP-1 may witness a hike of Rs2.74, nudging the rate up to Rs100.18 from the current price of Rs97.44 per litre.

Published in The Express Tribune, December 31^st, 2013.