ISLAMABAD: Fuel prices are expected to be reduced by up to Rs1.80 per litre in line with the falling global eed diesel (HSD) face reduction, the state-owned Pakistan State Oil (PSO) may face a huge loss as it had imported 210,000 tons aoil prices, effective from April 1, 2013.
“If the price of high spgainst a deficit of 50,000 tons in March,” a senior government official said, adding that previously PSO had been maintaining HSD stock for 12 days against government’s instruction of a stock of 21 days.
However, due to huge imports following directions of the Pakistan Peoples Party – led government, it imported a huge quantity and maintains a stock of 71 days presently. The official went on to say that the petroleum dealers had refused to make purchases due to expected cut in oil prices, which will lead to massive loss for the oil marketing giant.
PSO official said that the company imported products as per the market’s requirement besides uplifting its allocated volumes from local refineries considering the upcoming harvesting season in the country, which is about to start soon.
According to a summary moved to the government on Friday, the Oil and Gas Regulatory Authority (Ogra) had proposed a cut of Rs1.45 per litre from Rs109.21 to Rs107.76 per litre in the price of HSD, mostly used in the transport and agriculture sector. The reduction may provide a relief to the agriculture sector and reduction in inflation across the country.
Petrol prices may be reduced by Rs1.8 per litre, bringing the price down from Rs103.07 to Rs101.27 per litre.
Since petrol is an alternate to ‘scarce’ compress natural gas (CNG), consumers in some parts of the country, especially Punjab, have become dependent on petrol. The reduction in petrol prices will provide relief to motorists who are suffering due to CNG suspensions.
The price of Light Diesel Oil (LDO), which is mainly used by industries, may witness a cut of Rs4.93 per litre, bringing the price down to Rs89.85 per litre against the current rate of Rs94.78.
The price of kerosene oil had been proposed to be slashed by Rs4.69 per litre to 95.21 per litre against Rs99.90 presently. Kerosene is used for cooking in remote areas where liquefied petroleum gas (LPG) is not available.
Prices of jet fuels, JP-1 may be reduced by Rs4.87 per litre from Rs93.52 to Rs88.65 per litre, JP-4 will face cut of Rs4.60 per litre from Rs86.15 to Rs 81.55, and JP-8’s price may be cut by Rs 4.89 per litre from Rs93.21 to Rs 88.32 per litre.
The government had increased oil price up to 4.35 per litre to take effect from March 1, but the decision was reversed by the then prime minister Raja Pervez Ashraf, following protests by political parties. The decision was taken back following a cut in petroleum levy on petroleum products.
On February 28, the price of HSD had been raised by Rs4.35 per litre, petrol by Rs3.53 per litre, LDO by Rs3.93 per litre and kerosene oil Rs3.79 per litre.
Sources said that the finance ministry may oppose the cut in petroleum prices and emphasise to adjust the reduction in the petroleum levy.
Earlier, the petroleum levy was slashed to adjust the inflation in oil prices following orders of Ashraf, which the finance ministry said had incurred a revenue loss of Rs4.5 billion in March.