Fuel prices cut in early ‘Independence Day gift’

ISLAMABAD: For the second fortnight in a row, the government on Tues­day reduced the prices of major petroleum products — petrol and high speed diesel (HSD) — by about Rs8.47 and Rs6.70 per litre, respectively, with immediate effect for the next fortnight ending August 31, mainly because of lower prices in the international market.

The announcement of the price cut was brought forward by two days on the directives of Prime Minister Shehbaz Sharif, who wanted to give the people an “Independence Day gift”, according to an official who was called to work from home, along with others, to facilitate the move. Despite advice to the contrary from the Ministry of Finance and the Oil & Gas Regulatory Authority (Ogra), the prime minister, who was in Lahore, ensured that the price cut was announced immediately.

In a late-night announcement, the finance ministry said Ogra had worked out the consumer rates based on price variations in the international market.

The ex-depot petrol price was reduced to Rs260.96 per litre for the next 18 days from Rs269.43, down by 2.8pc (Rs8.47 per litre). In the retail market, petrol would, however, be available at around Rs272 per litre.

Petrol is mostly used in private transport, small vehicles, rickshaws and two-wheelers and has a direct bearing on the budget of middle and lower-middle classes.

The ex-depot price of HSD was slashed by Rs6.70 (2.45pc) to Rs266.07 per litre from Rs272.77 over the past fortnight. Most of the transport sector runs on HSD. Its price is considered inflationary as it is mostly used in heavy transport vehicles, trains and agricultural engines like trucks, buses, tractors, tube-wells and threshers and particularly adds to the prices of vegetables and other eatables.

Officials said the prices of petrol and HSD had declined in the international market by more than $3 per barrel in the last fortnight.

Published in Dawn, August 14th, 2024

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