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Five percent cut in oil prices likely
http://www.brecorder.com/index.php?id=1025347&currPageNo=1&query=&search=&term=&supDate="]http://www.brecorder.com/index.php?id=1025347&currPageNo=1&query=&search=&term=&supDate=[/URL]
ISLAMABAD (February 27 2010): Government is likely to cut oil prices by 5 percent in line with the reduction in global oil prices effective from March 1, Business Recorder has learnt. Sources said that reduction in oil prices might range from Rs 3 to Rs 3.50 per litre. The oil prices in international market had started surging upwards from February 15.
"Had the prices in international market not jumped up in mid February, the government would have been able to reduce oil prices by Rs 4-4.50 per liitre," the sources maintained. The price of crude oil has declined by $3.5 per barrel in the Gulf market and was currently selling at $74 per barrel against $77.5 per barrel in January. According to the current pricing mechanism, oil refineries see no improvement in their financial position even with 7.5 percent deemed duty on High Speed Diesel (HSD).
According to Ogra notification regarding oil price for the current month of February, Government is charging Rs 12.36 per litre Petroleum Levy (PL) on petrol and Rs 16.79 per litre on HBOC for direct sale to consumers by Oil Marketing Companies (OMCs). PL will be reduced from Re1 to 50 paisa per litre in an effort to adjust the margins of dealers and OMCs on direct sale of these products to the consumers in line with reduction in global oil prices," the sources maintained.
The government is currently collecting Rs 9.82 per litre general sales tax on petrol, Rs 11.98 per litre on HOBC, Rs 8.84 per litre on kerosene oil and Rs 8.42 per litre on LDO. "Government charges GST at the rate of 16 percent and cut in oil prices may also lead to reduction in GST collection on petroleum products," they noted.
The government had increased the price of petroleum products by 5 to 9 per cent with an increase in petrol price by Rs 6.10, HOBC (High Octane Blending Component) by Rs 7.41, High Speed Diesel (HSD) by Rs 3.33 per litre, kerosene oil by Rs 3.32 per litre and Light Diesel Oil (LDO) by Rs 2.97 per litre effective from February 1. "The five percent cut in POL prices will not bring any appreciable relief to the consumers," experts said.
Copyright Business Recorder, 2010
http://www.brecorder.com/index.php?id=1025347&currPageNo=1&query=&search=&term=&supDate="]http://www.brecorder.com/index.php?id=1025347&currPageNo=1&query=&search=&term=&supDate=[/URL]
ISLAMABAD (February 27 2010): Government is likely to cut oil prices by 5 percent in line with the reduction in global oil prices effective from March 1, Business Recorder has learnt. Sources said that reduction in oil prices might range from Rs 3 to Rs 3.50 per litre. The oil prices in international market had started surging upwards from February 15.
"Had the prices in international market not jumped up in mid February, the government would have been able to reduce oil prices by Rs 4-4.50 per liitre," the sources maintained. The price of crude oil has declined by $3.5 per barrel in the Gulf market and was currently selling at $74 per barrel against $77.5 per barrel in January. According to the current pricing mechanism, oil refineries see no improvement in their financial position even with 7.5 percent deemed duty on High Speed Diesel (HSD).
According to Ogra notification regarding oil price for the current month of February, Government is charging Rs 12.36 per litre Petroleum Levy (PL) on petrol and Rs 16.79 per litre on HBOC for direct sale to consumers by Oil Marketing Companies (OMCs). PL will be reduced from Re1 to 50 paisa per litre in an effort to adjust the margins of dealers and OMCs on direct sale of these products to the consumers in line with reduction in global oil prices," the sources maintained.
The government is currently collecting Rs 9.82 per litre general sales tax on petrol, Rs 11.98 per litre on HOBC, Rs 8.84 per litre on kerosene oil and Rs 8.42 per litre on LDO. "Government charges GST at the rate of 16 percent and cut in oil prices may also lead to reduction in GST collection on petroleum products," they noted.
The government had increased the price of petroleum products by 5 to 9 per cent with an increase in petrol price by Rs 6.10, HOBC (High Octane Blending Component) by Rs 7.41, High Speed Diesel (HSD) by Rs 3.33 per litre, kerosene oil by Rs 3.32 per litre and Light Diesel Oil (LDO) by Rs 2.97 per litre effective from February 1. "The five percent cut in POL prices will not bring any appreciable relief to the consumers," experts said.
Copyright Business Recorder, 2010
