ISLAMABAD: For the second consecutive day, the government on Tuesday reduced the prices of major petroleum products — petrol and high speed diesel (HSD) — by about Rs 8.47 and Rs 6.70 per litre respectively, with immediate effect for the next two weeks up to August 31, mainly due to lower prices in the international market.
The announcement of the price cut was brought forward by two days on the instructions of Prime Minister Shehbaz Sharif. He wanted to give people an “Independence Day gift,” according to an official who, like others, had to work from home to facilitate the action. Despite contrary advice from the Finance Ministry and the Oil and Gas Regulatory Authority (Ogra), the prime minister, who was in Lahore, ensured that the price cut was announced immediately.
In a late-night statement, the Finance Ministry said Ogra had calculated consumer tariffs based on price fluctuations in the international market.
The ex-depot price of petrol has been reduced from Rs 269.43 to Rs 260.96 per litre for the next 18 days, a decrease of 2.8 per cent (Rs 8.47 per litre). However, petrol would be available at retail at around Rs 272 per litre.
Petrol is mainly consumed in private transport, small vehicles, rickshaws and two-wheelers and has a direct impact on the budgets of the middle and lower middle classes.
The stock price of HSD has been reduced by Rs 6.70 (2.45 percent) from Rs 272.77 to Rs 266.07 per litre in the last two weeks. Most of the transport sector runs on HSD. Its price is considered inflationary as it is mainly used in heavy transport vehicles, trains and agricultural machinery like trucks, buses, tractors, borehole drilling rigs and threshing machines and it particularly pushes up the prices of vegetables and other food items.
According to official figures, prices for gasoline and HSD on the international market have fallen by more than three dollars per barrel in the last two weeks.
Published in Dawn, August 14, 2024
