Finance ministry gets Ogra summary for fuel price cut

ISLAMABAD: The Finance Ministry after getting a summary from Ogra has worked out the reduction in Mogas (Petrol) price by Rs15 per litre and diesel by Rs33.99 per litre from July 16, 2022. The new price of petrol has been proposed at Rs219.70 per litre after jacking up the petroleum levy (PL) byRs5 per litre to Rs15 per litre, from Rs10 per litre, and diesel Rs241.30 per litre after increasing the petroleum levy to Rs10 per litre from the existing Rs5 per liter.

However, without the increase of Rs5 per litre petroleum levy, the reduction inthe price of diesel has been worked out by Ogra at Rs38.99 per litre and petrol at Rs20.07 per litre. The prime minister wants to pass the reduction in prices of diesel and petrol on to consumers without the increase in the petroleum levy by Rs5 each, a senior official at the Finance Ministry told The News.

Top sources say that the Finance Ministry top mandarins want the prime minister to allow it to increase the petroleum levy by Rs5 per litre each on petrol and diesel as the government is bound to increase the petroleum levy on both the POL products by Rs50 each gradually in the current budgetary year to achieve the revenue target of Rs850 billion. The Finance Division is of the view that the massive reduction in crude oil prices in the international market has provided the space to increase the petroleum levy apart from reducing the POL prices from July 16, 2022.

However, the federal cabinet that meets on July 15 (tomorrow) will make the final decision about the decrease in the POL prices after getting the input of the cabinet members of allied parities.

It is to be noted that in the existing price of diesel, there is a petroleum levy of Rs5 per litre and in the price of petrol, the petroleum levy stands at Rs10 per litre and in the price of kerosene oil, PL stands at Rs5 per litre.

In the price of furnace oil which is used in IPPs for power generation, a massive relief has been worked at Rs12,981 per ton to Rs141,360 from Rs154,341 per ton. There is no petroleum levy on furnace oil.