ISLAMABAD: The government Thursday reduced the petroleum products’ prices which are incompatible with the recommendations of the Oil and Gas Regulatory Authority (Ogra).
The crude oil prices on the international market have registered a sharp decline but the government did not fully pass the benefit on to the consumers and focused on meeting its tax revenue targets for which petroleum levy and GST is being charged.
The government announced a cut of Rs15/liter each in petrol (public transport fuel) and Light Diesel Oil (LDO). The prices of diesel and kerosene have been decreased by Rs27.15/liter and Rs30.01/liter respectively.
The new prices will be effective from May 1 to midnight 31, 2020. It is worth mentioning that since the PTI government came into power in August 2018, the crude oil prices have reduced by $47.1/barrel (or 65 per cent).
In August 2018, the Brent oil spot price on the international market was $72.5 perbarrel and came down to $25.46 a barrel on 30th April. In August 2018, when the Brent oil price was $75.5 a barrel, the local market price of diesel was Rs112.94 per liter, of petrol Rs95.24 per liter, of kerosene Rs83.96 and of Light Diesel Oil (LDO) prices Rs75.37per liter.
Now, when the Brent price is $25.4/barrel, the government has brought the local products prices down, but not proportionately.
According to the government notification, petrol prices have been reduced to Rs81.58 from Rs96.58/liter, diesel to Rs80.10/liter from Rs107.25, and LDO to Rs47.51 from earlier Rs62.51/liter.
The kerosene price has also been slashed to Rs47.44 from earlier Rs77.45/liter. It is also worth mentioning that since July 2019, Pakistan is also receiving monthly Saudi oil supplies worth $275 million every month on deferred payment.
Under this arrangement, Pakistan would get this oil facility to the tune of $9.9 billion over the next three years. The Ogra had suggested the government to reduce diesel prices by Rs33.94/liter, petrol by Rs20.68/liter, kerosene by Rs44.07/liter and LDO by Rs24.57/liter.
It is worth mentioning that government is also charging 17 percent General Sales Tax (GST) on all petroleum products. Apart from it, the government is also collecting Petroleum Levy (PL) on these products, which is directly taken from the consumers.
In order to meet the revenue shortfall, the government, for March 2020, had increased petroleum levy (PL) on the petroleum products. The PL on diesel was increased by 7.05 to Rs25.05 per litre. The levy on petrol was increased by Rs4.75 to Rs19.75 per liter from earlier Rs15 per litre. PL on kerosene was also increased by Rs6.33 to Rs12.33 per liter and PL on LDO was increased by Rs1.94 to Rs4.94 per litre
However, the government on Thursday again increased PL on diesel by Rs4.95/litre and now it would be charged Rs30/litre from consumers.
PL on petrol has been increased by Rs4.01/litre to 23.76/litre, PL on Kerosene increased by Rs5.69/litre to Rs18.02/litre and PL on LDO has been jacked up by Rs6.24/litre and now it will be charged at the rate of Rs11.18/litre.
Meanwhile, the government Thursday increased the local LPG price by 23.9 percent to Rs1,322.9/cylinder for May 2020 as its price has also increased on the international market.
In absolute terms, this is an increase of Rs255.5/11.8kg cylinder from Rs1067.39/cylinder in April. The new prices would come into effect from May 1 (today). Commercial cylinder price has also been increased by Rs983 to Rs5,090 from Rs4,107/cylinder.
The Oil and Gas Regulatory Authority (OGRA) notified the new rates, under which the LPG price has been increased by Rs21.66/kg to Rs112.11/kg from the April price of Rs90.45/kg.
Meanwhile, the All Pakistan CNG Association (APCNGA) central chairman Ghiyas Abdullah Paracha announced Rs12.5/litre reduction in CNG prices for Punjab and Islamabad. Now, the new price of CNG will be Rs72/litre and will be effective from Friday (today). He said the reduction had been made, as the LNG price in international market had reduced.
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