Iraq crisis: Fuel prices likely to go up in July

OGRA moves a summary to finance and petroleum ministries following fluctuation in global market.

ISLAMABAD:

Consumers are facing the possibility of an increase of up to Rs3.63 per litre in petroleum prices next month following a hike in global fuel prices. Officials said that fuel prices in the world market have gone up due to the volatile situation in Iraq created by occupation of several oil fields by insurgents.

On Saturday, the Oil and Gas Regulatory Authority (Ogra) moved a summary to finance and petroleum ministries, suggesting an increase in fuel prices following fluctuation in the global market. The new fuel prices would be notified following the prime minister’s approval today (Sunday).

In a summary moved to the concerned ministries, the oil and gas regulator had recommended that current prices should be moved to provide relief to the consumers by adjusting a hike in the petroleum levy (PL). According to officials, the finance ministry would oppose any adjustment in petroleum, fearing that it would lose revenue.

According to the summary, the price of petrol may go up by Rs0.84 per litre, High Octane Blending Component (HOBC) Rs3.63 per litre, kerosene oil Rs0.30 per litre, High Speed Diesel (HSD) Rs0.27 per litre and Light Diesel Oil (LDO) Rs0.22 per litre.

After the proposed hike, the price of petrol which is commonly used in vehicles where compressed natural gas (CNG) is not available, may go up to Rs108.81 per litre. At present, CNG is available in Punjab for two days a week and in Ramazan, CNG sector may face another curtailment causing lead in jump in consumption of petrol.

The price of HOBC, which is used in luxury vehicles, may witness hike of Rs3.63 per litre, leading to a new price of Rs138.26 per litre.

The price of kerosene oil, which is used in areas where the Liquefied Petroleum Gas (LPG) is not available for cooking, may rise up to Rs97.70 per litre.

The HSD is used in agriculture and transport sectors and hike in its price may lead to an increase in inflation. Its price is expected to go up to Rs109.61 per litre leading to escalation in inflation. The price of LDO mainly used in industry may go up to Rs94.35 per litre.

Published in The Express Tribune, June 29^th, 2014.