In the last two and a half months the government has increased the petroleum prices five times and now OGRA again pushed a summary to hike the prices of key petroleum products — petrol and high-speed diesel (HSD). and they are estimated to go up by Rs9-11 per litre on Jan 31 for the first fortnight of February if straight calculations of OGRA are accepted by the prime minister.
The last time the government reduced the prices of petroleum product was November 15 last when per litre prices of petrol and high speed diesel (HSD) were reduced by Rs1.71 and Rs1.79 per litre, respectively. However, since then continuous spike witnessed in the prices of petroleum products and from November 15 to January 15 the price of petrol was increased by Rs8.50 per litre and HSD by Rs11.76 per litre, respectively, while the prices of kerosene and light diesel oil jumped by Rs11.39 per litre and Rs13.37 per litre, respectively.
However, according to energy experts, based purely on international prices published in Platt’s Oilgram, the prices of petrol and HSD would need an increase of Rs2.30 per litre and Rs2.11 per litre, respectively. A Petroleum Division source also endorsed views and said that based on import shipments as of January 27, the petrol price was higher by Rs2.30 per litre and HSD by Rs2.11 per litre.
Under the government instructions, OGRA is required to calculate oil prices on the basis of 17 percent general sales tax and maximum petrol levy permissible under the law at Rs30 per litre on HSD and petrol. The government later announced a lower than OGRA-determined prices on political considerations and also leaks OGRA’s summary to select media.
Therefore, OGRA had worked out an increase of about Rs9.02 per litre and Rs10.74 per litre on HSD and petrol, respectively. This is because the petroleum levy currently stands at Rs21.56 per litre on petrol and Rs23.09 per litre on HSD.
On Jan 15, the government had increased the prices of HSD and petrol by Rs2.95 per litre and Rs3.20 per litre against OGRA’s calculation of Rs11 per litre and Rs13 per litre, respectively. The existing price of petrol is Rs109.20, HSD Rs113.19, Kerosene Rs76.65 and LDO Rs76.23 per litre, respectively.