Prices of petroleum products slashed

ISLAMABAD: Owing to sharp decline in international crude price, the government on Sunday reduced petrol price by Rs7.06 per litre, kerosene Rs11.88 per litre and light diesel oil (LDO) by Rs9.37 per litre for June 2020.

However, the price of high speed diesel (HSD) has been increased by 0.05 paisa per litre. The new prices will be effective from today (Monday) to midnight of June 30.

It is worth mentioning that the Petroleum Division had proposed to the government to keep the petroleum products’ prices unchanged for at least next fortnight, as the oil marketing companies (OMCs) and oil refineries had approached the Division asking for it. These refineries and OMCs had taken plea that if the government reduces the prices, they will face inventory losses, but the government took the decision and decided to pass on the benefit of low oil prices to the consumers.

The government approved the reduction in petroleum prices what the Oil and Gas Regulatory Authority (Ogra) had recommended. After this new approval, petrol price has come down from Rs81.58/litre to Rs74.52/litre, kerosene price came down to Rs35.56/litre from previous Rs47.44/litre and the LDO price reduced to Rs38.14/litre from previous Rs47.51/litre. The diesel price has been increased by Re0.05/litre to Rs80.15/litre.

It is worth mentioning that the 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 consumers.

It is also worth mentioning that since July 2019, Pakistan is also receiving monthly Saudi oil supplies worth $275 million/month on deferred payment. Under this arrangement, Pakistan would get this oil facility to the tune of $9.9 billion over next three years.

Meanwhile, Prime Minister Imran Khan said that after the new reduction in prices of petroleum products, now the country had the cheapest fuel cost compared to other states in South Asia while India was almost exactly double. In a tweet, the prime minister said, “We have further reduced petrol, light diesel oil, kerosine [sic] oil prices. Now we have the cheapest fuel cost compared to other states in South Asia. India is almost exactly double. Bangladesh, Sri Lanka & Nepal are all 50 to 75 percent more expensive than us.” HE has also uploaded a table showing reductions in oil prices made from May 01 to June 01.