Petrol price expected to increase in next fortnightly review
Diesel price may also see a significant jump next fortnight after petroleum levy increase
August 30, 2022
- FOB reflects decrease in petrol price, but consumers might not benefit from it.
- Govt may pile taxes on petroleum products along with exchange loss adjustment.
- Diesel rate may see significant jump in next review after petroleum levy increases.
KARACHI: The petrol prices on free on board (FOB) basis reflect a Rs20 per litre fall for consumers in the next fortnightly rate review, but it is unlikely to go cheaper as the government may pile taxes on petroleum products along with exchange loss adjustment, The News learnt Monday.
However, the price of diesel should increase by Re1 per litre on a FOB basis in the next review. The FOB is the price difference between petroleum prices in the international market and the domestic market.
However, the oil industry doesn’t see a reduction in the price of petrol in the next fortnight on the basis of FOB.
According to the industry people, the government is likely to further jack up the petroleum levy (PL) on petrol in the next fortnight, while arrears of exchange loss will still be adjusted in the petroleum prices.
“Any reduction in the price of petrol seems unlikely as despite a fall in its price in the global market,” the oil sector people believed. They said the diesel price may see a significant jump in the next fortnight after increasing the PL on it.
Its price may also jump further if the government slapped sales tax on its sale, which has been frozen for the last six months.
The oil sector people said the government was yet to adjust the exchange loss, which was Rs23 per litre on petrol and Rs13 per litre on diesel.
They said that the average international petrol price during the fortnight was $103 per barrel, diesel $139 per barrel, and crude oil stood at $97 per barrel, while the average exchange rate was almost Rs217 per litre.
They said that consumers were unlikely to benefit from the price reduction in the international market, particularly in petrol and there may be a major increase in the price of diesel in the next fortnightly review.
According to media reports, the government plans to collect Rs10.5% GST and Rs30 per litre PL, in addition to other charges like dealers’ and distributors' margins.
The government expects to collect Rs60 billion as PL and Rs31 billion as GST per month. The price of petrol is presently Rs233.91 per litre, diesel Rs244.44 per litre, kerosene oil Rs199.40 per litre, and the price of light diesel oil is Rs191.75 per litre.
