The federal government Monday reduced the prices of all petroleum products to pass on some benefit of lower international prices to consumers. On the recommendations of the Oil and Gas Regulatory Authority (Ogra), Prime Minister Imran Khan approved some changes in the prices of petroleum products, entailing reduction in prices of all products. As such, the ex-depot price of high-speed diesel (HSD) was cut by Rs 4.26 per litre to Rs 106.68 from Rs 110.94 per litre.
Likewise, the ex-depot price of petrol has been set at Rs 90.97 per litre, down by Rs 4.86. Also, the ex-depot kerosene price has been fixed at Rs 82.98 per litre instead of Rs 83.50, down by 52 paisas. The price of light diesel oil (LDO) has been reduced to Rs 75.28 per litre from Rs 77.44, down by Rs 2.16 per litre. In doing so, the PTI government changed the existing tax rates on any of these products. The new prices will remain in place throughout January.
The Ogra had recommended a reduction in the prices of petroleum products up to 13.5 percent for January 2019. The regulatory authority suggested that prices of petrol may be reduced by Rs 9.50 per litre (10 percent), high speed diesel (HSD) by Rs 15 per litre (13.5 percent), kerosene oil by Rs 0.25 and light diesel oil (LDO) by Rs 2.00 per litre for the month of January 2019.
The regulatory authority recommended decrease in prices of petroleum products by calculating them at 17 percent general sales tax (GST). From December 1, 2018, the Federal Board of Revenue (FBR) increased sales tax on diesel from 12 percent to 13 percent while for petrol it was increased from 4.5 percent to 8 percent. However, the sales tax on petrol was kept low as compared to the standard rate of sales tax which is 17 percent for month of December.
The HSD sales across the country are now going beyond 900,000 tonnes per month against monthly consumption of around 650,000 tonnes of petrol. The sales of kerosene and LDO are generally around 9,000 tonnes per month.
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