Islamabad - The government on Thursday increased prices of petroleum products effective from December 1.

In response to the Oil and Gas Regulatory Authority (Ogra) recommendations, the federal government has increased the price of petrol by Rs1.48 per litre, High-Speed Diesel (HSD) by Rs1.36 per litre, kerosene oil by Rs 4.39 per litre and Light Diesel Oil (LDO) by Rs3.12 per litre.

As a result of the increase, the new petrol price has jumped to Rs77.47 per litre from Rs 75.99 per litre. The HSD was increased to Rs 85.95 from the earlier Rs84.59. Similarly, the price of kerosene oil, after an increase of Rs4.39, has gone up to Rs 57.58 per litre from Rs53.19 per litre and the price of LDO with an increase of Rs3.12 per litre to Rs 52.12 from previous Rs49.00 per litre. The new prices will be applicable from Today (Saturday).

The OGRA had recommended the government to increase price of motor spirit (petrol) by Rs1.48 per litre for December and the ex-refinery price of high-speed diesel (HSD) by Rs1.2 per litre. According to a working paper moved to the Ministry of Energy (Petroleum Division) and the Ministry of Finance, the OGRA had recommended an increase of up to 28.9 percent in the prices of different petroleum products. The OGra had proposed an increase of Rs15.35 per litre in the price of superior kerosene oil and Rs13.15 per liter increase in light diesel oil (LDO) rate.

The Economic Co-ordination Committee (ECC) deregulated margins on HSD for oil marketing companies (OMCs) and dealers. The ECC approved the deregulation of the HSD price with a directive that the impact of the policy would be reviewed after three months. The OGRA would develop a mechanism to monitor the OMCs commercial stock position, inventory system and fuel marker system.

The ex-refinery price of HSD was Rs50.07 in November and the OGRA had recommended an increase of Rs1.2 per litre which will increase the price of HSD to Rs51.27 per litre. The dealer and OMC margin will be decided by the OMCs while GST and Petroleum Development Levy (PDL) will be determined by the petroleum and finance divisions. According to a working paper, The OGRA had proposed an increase of Rs15.35 per litre in price of superior kerosene oil and Rs13.15 per liter increase in light diesel oil (LDO), which meant a hike of 28.9 percent per litre and 26.8 percent per litre respectively.

Against the standard rate of 17 percent general sales tax (GST), currently, the government is charging 31 percent GST on HSD and 17 percent on other petroleum products including petrol, kerosene oil and LDO. In addition to the GST, the government was charging highest rates of PDL from consumers. Currently, consumers are paying Rs10 per litre PDL on petrol, Rs6 per litre on kerosene oil and Rs 3 per litre on LDO.