The government on Friday reduced the price of petroleum by Rs2 per litre, negating the proposed hike by the Oil and Gas Regulatory Authority. 

Finance Minister Asad Umar during a press conference has announced a decrease of Rs2 per litre in petrol and diesel prices

He said, price of kerosene oil has been cut by Rs3 per litre, whereas light diesel oil price has been slashed by Rs5 per litre. Price of domestic gasoline has been decreased by Rs2 per litre. 

Earlier, on Thursday, OGRA had sought an increase of up to Rs10 in the prices of petroleum products.

In a summary forwarded to the petroleum division, the authority had recommended an increase of Rs6.21 per litre in petrol prices, Rs2 per litre in diesel prices , Rs9.91 in kerosene oil prices and Rs7.79 in light diesel prices .

Asad Umer told, "Global oil prices rose in October, however the government only increased the petroleum prices by half as much that month."

Petrol prices had been raised by Rs5 per litre in October.

The finance minister said the Petroleum Development Levy (PDL) on petrol has been cut to Rs6.15 from Rs10, while the PDL on diesel has been reduced to Rs6.56 from Rs8.

He further explained that the sales tax has been reduced from 15 per cent to 4.5 per cent on petrol, and from 27.5 per cent to 12 per cent on diesel. The cuts in sales tax and PDL were made to keep the petroleum prices in check.

Following the price revisions, petrol will now be sold at Rs95.83 per litre, diesel at Rs110.94 per litre, kerosene oil at Rs83.50 and light diesel oil at Rs77.44, effective from December 1. 

Umar said there seems to be room for further improvement in the prices in the near future. "We are making changes to the taxes but we want to transfer any improvements to the public," he said. 

In the global market, oil prices gained on Thursday after the US benchmark slid below $50 a barrel following reports Russia could join a production cut at next month's OPEC meeting.