The federal government has reportedly decided, for the third time in two months, not to transfer the benefit of declining international oil prices to the general public. Instead, it is considering imposing an additional charge of Rs4.12 per liter on petroleum products.
According to Dawn, the government has withheld a cumulative reduction of approximately Rs18 per liter in petroleum prices over the past two months. This approach aims to discourage a surge in fuel consumption.
Absent these measures, the prices of petrol and diesel were projected to decrease by approximately Rs3.5 and Rs7 per liter, respectively, for the upcoming fortnight starting May 15. This anticipated drop is attributed to a decline in global oil prices and a modest reduction in the import premium on petrol. The price adjustment has been managed in part by increasing the petroleum levy, including through a special presidential ordinance.
This time, the Petroleum Division has recommended to the Economic Coordination Committee (ECC) of the Cabinet that the financial benefit from reduced international prices be diverted to oil companies.
The Rs4.12 per liter adjustment translates into an estimated annual impact of around Rs75 billion, intended to support oil marketing companies (OMCs), refineries, and retail dealers in meeting their financial requirements.
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