No oil price relief in near future

13 Dec, 2006

The consumers are not going to have any relief in oil prices, as the government is not considering reduction, at least for the fortnight starting from December 16. Upward trend in the international market provides the government a reason not to reduce oil prices for the domestic market.
The officials have time and again made it clear in their statements that the government would not reduce oil prices unless it made up the loss it suffered in tax collection from petroleum products in the recent past when its actual prices were not passed on to the consumers.
They hardly bothered how hard the government policy of keeping the petroleum prices unchanged was hitting the consumers. However, the case filed with the Supreme Court of Pakistan for reviewing the prices of petroleum products had given small hope that the government may change its mind and give some relief at least for the time being to the consumers. But bouncing back of oil prices in the international market has minimised the chances of any such relief in near future.
An official told Business Recorder on Tuesday that the government was watchful of the entire scenario, and the situation for the time being may not be favourable for relief to the consumers as oil prices were again showing upward trend in the international market.
After showing downward trend, the oil prices in the international market are again touching the level of $62 per barrel and the officials in Islamabad are not expecting any sharp reduction in the next couple of weeks.
However, the Oil and Gas Regulatory Authority (Ogra), having powers to review oil prices on fortnightly basis, is working out its formula to suggest to the government the new rates for the next 15 days. Sources said that Ogra would submit its pricing formula for the next fortnight on the basis of international market rates and it is the government to decide the question of relief for the consumers by reducing oil prices in the local market.

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