The government on Monday reduced petrol prices by Rs 5 per litre and revised diesel and kerosene prices upward by Rs 3.50 a litre. A formal notification of the new oil prices was issued by Oil and Gas Regulatory Authority (Ogra) late Monday night. The changed prices will be effective from September 16.
The reduction in oil prices in global market is a basic reason for persuading the government officials to give some relief to the consumers at least in the petrol rates. Petrol prices for the consumers from September 16 will be Rs 81.68 a litre. Kerosene and diesel new rates will be Rs 61.87 and Rs 60 a litre.
Diesel and kerosene prices, however, have been raised to cut down subsidy the government pays to the oil marketing companies for them. Huge subsidy on oil prices is considered one of many factors which pushed Pakistan's economy in grey area. Now the government is following a cautious approach and despite crude oil prices coming down to $92 a barrel in global market it is reluctant to give major relief to the consumers.
A spokesman of Ogra said that the price of motor spirit has been reduced by Rs 5 per litre keeping in view the current declining trend in international crude oil prices. The prices of Kerosene, and LDO have, however, been increased by Rs 3.50 per litre in view of the fact that these products have been heavily subsidised for a long time. This prolonged subsidy has resulted in accumulation of large price differential claims payable to OMC's and refineries by the government.
Even after the increase, the government continues to provide a subsidy of Rs 10.93 per litre and Rs 9.49 per litre on kerosene, and LDO respectively. The price of HSD has also gone up by Rs 3.50 per litre and the subsidy after this increase will be Rs 9.42 per litre.