Reduction in prices of petroleum products notified – Newspaper

ISLAMABAD: The finance division notified on Saturday the new prices of petroleum products that have fallen by 5.8 percent in September due to the decline in prices in the international market. According to a statement, the purchase price of gasoline has been reduced by Rs4.59 per liter to Rs113.24 per liter to be effective as of September 1 from Rs117.83 per liter previously.

Similarly, the price of high-speed diesel (HSD) has been reduced by Rs5.33 per liter to Rs127.14 per liter from Rs132.47 previously. The new purchase price includes the impact of taxes and distribution charges.

The average purchase price of gasoline, including customs duties during the last imported period, has been Rs71.89 per liter and that of HSD Rs82.06 per liter before taxes and distribution cost.

The statement of the Ministry of Finance stated that the final purchase price of gasoline in terms of parity of rupees is significantly lower than prices in regional markets, such as India, where it is available at Rs168.25 per liter; Sri Lanka Rs144.15 per liter and Bangladesh Rs168.79 per liter, respectively.

It is worth mentioning that the Oil and Gas Regulatory Authority (Ogra) had achieved a reduction of Rs7.67 per liter in HSD, but the government has approved a reduction of only Rs5.33 per liter. In terms of gasoline, all the reduction recommended by Ogra has been transferred to final consumers.

Similarly, the total impact on the price of kerosene and light diesel (LDO) has been transferred to final consumers.

The government reduced the price of kerosene by Rs4.27 per liter to Rs99.57 per liter of Rs103.84 per liter, while in the case of LDO the reduction is Rs5.63 per liter to Rs91.89 of Rs97.52 per liter

The Ministry of Finance clarified that the procedures for calculating the price of oil are determined by Ogra using actual orders made by Pakistan state oil for HSD and gasoline. Then, Ogra adds the predefined costs, such as freight, port handling and margins of oil marketing companies / retailers.

For three months, the general sales tax was set at 17pc when in the 2015-16 fiscal year it had reached 71pc in HSD. In addition, the oil development tax is also fixed. Therefore, Ogra notifies any variation in the purchase price of PSO during the last imported period. It was also explained that if international prices show a downward trend, this occurs with 30-40 days, subject to the exchange rate movement.

Posted on Dawn, September 1, 2019

Source: https://www.dawn.com/news/1502871/reduction-in-prices-of-petroleum-products-notified

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