The government on Tuesday cut petroleum products'' price by up to Rs 5.05 per litre in line with reduction in global oil prices effective from Wednesday (today). The price of petrol has been reduced by Rs 1.70 per litre, High Speed Diesel (HSD) by Rs 3.20 per litre and Kerosene oil by Rs 5.05 per litre.
However, no change has been made in prices of Light Diesel oil (LDO) and High Octane Blending Component (HOBC). Oil and Gas Regulatory Authority (Ogra) on Monday moved a summary to Petroleum and Finance Ministries with recommendation to reduce oil prices by up to Rs 5.05 per liter effective from June 1, 2011 in line with reduction in global oil prices, but oil refineries were not able to provide unanimous inputs to the authority, therefore, it delayed the announcement of new prices.
After the cut, new price of petrol will be Rs 86.71 per litre, Kerosene oil Rs 84.65 per litre and HSD will be Rs 94.11 per litre. Prime Minister Syed Yousuf Raza Gilani accorded approval today (Tuesday) to reduce oil prices in line with Ogra recommendations.
The rates of transportation charges have been revised upwards due to different reasons. White Oil Pipeline (WOP) freight charges have been estimated in US Dollar and an average selling exchange rate of State Bank of Pakistan (SBP) has been taken for conversion into rupee that went up from Rs 84.35 to Rs 85.54.
It is worth mentioning here that earlier Ogra had allowed an increase of 45 per cent in cartage freight rate effective from May 1, 2011 due to strike by All Pakistan Oil Tankers Association (APOTA). The increase has been incorporated for the computation of Inland Freight Equalisation Margin (IFEM).
As a consequence of increase in cartage rates, Parco''s inland road freight from Karachi to Mahmoodkot has been revised upwards from Rs 3.07 per litre to Rs 4.10 per litre effective from June 1, 2011. Attock Refinery Limited (ARL) crude transportation recovery rates for month of June 1, 2011 have been reduced to zero due to its surplus position. However, IFEM has been increased by 80 paisa per liter on petrol, 69 paisa per liter kerosene oil and 46 paisa per.