Petroleum prices may increase by Rs28.44 on Monday

The Oil and Gas Regulatory Authority (OGRA) has calculated a price increase for petroleum products of up to Rs28.44 per litre that could go into effect on August 1.

According to regulatory agency sources, the estimated ex-depot price of gasoline may increase by Rs6.53, high-speed diesel (HSD) by Rs28.44, kerosene oil (SKO) by Rs11.02, and light diesel oil (LDO) by Rs5.64 per litre based on the current rate of petroleum levy (PL).

On Saturday (today), the Finance Division will move a summary calling for an increase in gasoline prices of up to approximately 11 per cent beginning August 1. The prime minister will, as usual, make the final choice in this matter.

The cost of gasoline and HSD will also increase if the government decides to include the Rs7 per litre petroleum dealer’s per centage in the pricing structure. The Economic Coordination Committee (ECC) had earlier that day approved the petroleum dealers’ increased margin.

The Petroleum Division had given the dealers assurances that the government would implement the margin as of August 1, 2022.

According to these projected prices, the price of gasoline would increase from Rs230.24 to Rs236.77 per litre, the price of HSD from Rs236.00 to Rs264.44 per litre, the price of SKO from Rs196.45 to Rs207.47 per litre, and the price of LDO from Rs191.68 to Rs197.32 per litre.

Presently, the PL on gasoline is Rs10 per litre, the PL on HSD, SKO, and LDO are each Rs5, and there is no sales tax.

In order to reach the budgetary goal of Rs750 billion set in the Finance Bill 2022–23, the National Assembly has approved a rise in the maximum limit of PL from Rs30 per litre to Rs50 per litre.

Read more: Petrol, diesel prices may increase by Rs10-17 per litre

However, sources in the Petroleum Division believed that, at the current rate, the government was unlikely to collect Rs750 billion from PL in the current fiscal year, as that would only amount to a maximum of Rs14 billion per month.

In addition, if the 17.5 per cent general sales tax (GST) is not imposed on these goods, a revenue shortfall of Rs45 billion per month is likely.