Petrol, diesel unchanged as govt skips expected price cuts
ISLAMABAD: Despite high expectations of a cut in the prices of two key fuel products, the government on Tuesday kept the prices of petrol and high-speed diesel (HSD) unchanged for the next fortnight.
However, it slightly reduced the prices of kerosene, light diesel oil and liquefied petroleum gas (LPG).
In a late-night announcement, the Ministry of Finance said the ex-depot prices of petrol and high-speed diesel had been maintained at Rs283.38 and Rs303.18 per litre, respectively. However, the ex-depot prices of kerosene and light diesel oil had been reduced by Rs3.82 and Rs3.40 per litre to Rs211.03 and Rs189.46.
Sources said the HSD’s price should have gone down by Rs5 per litre but adjustments in tax rates were made to keep it unchanged.
On the other hand, the petrol price reduction estimated to be around Rs17 per litre could not be made because of clearance of letters of credit for two cargoes on Oct 29. As a normal practice, this should have become part of the next fortnight’s pricing but was taken into calculation immediately.
As a result, the prices of both major products were kept unchanged. However, the sale margins for dealers and oil marketing companies were slightly increased by about 80 paise per litre cumulatively.
Currently, the government charges about Rs80 per litre tax on petrol and Rs77 per litre on HSD. Although the general sales tax is zero on all petroleum products, the government charges Rs60 per litre petroleum development levy on petrol and diesel.
LPG price reduced
The government on Tuesday also decreased the price of LPG by about 3.8pc, bringing down the cost of the 11.8kg domestic cylinder by Rs117.47 for November.
In a notification, Ogra set the price at Rs251 per kg for November against Rs261 in October. This brings down the domestic cylinder price to Rs2,962.17 for Nov from Rs3,079.64 in Oct The price of the commercial cylinder (45.4kg) declined by Rs453 to Rs11,397 for Nov against Rs11,850 in October.
Ogra attributed the reduction in LPG price to the rupee’s appreciation, as global oil prices had increased in the Saudi market.
As per Ogra’s calculations, the producer price of LPG (propane 40pc and butane 60pc) has been determined at Rs173,069 per tonne for Nov against Rs181,506 in Oct. This price included an excise duty of Rs85 per tonne. Therefore, the producer price for the 11.8kg cylinder was worked out at Rs2,042.22 compared to Rs2,142 last month.
With the addition of Rs4,669 per tonne of petroleum levy and 18pc (Rs31,99 per tonne) general sales tax, the maximum producer price was worked out at Rs209,731 for November against Rs219,687 in October.
For consumer price, another Rs35,000 per tonne of marketing, distribution and transportation margin was added to the maximum producer price besides another 18pc GST (Rs6,300 per tonne on this margin).
Therefore, the consumer-end maximum LPG price was fixed at Rs251,031 per tonne or Rs2,962 per domestic cylinder for November against Rs260,987 per tonne or Rs3,080 in October. The new prices would remain effective until Nov 30.
Published in Dawn, November 1st, 2023