The government since May 1, 2004 has suffered a budgetary loss of Rs 40 billion to the government's exchequer and still continues to absorb the loss. These costs not only include the loss to the petroleum development levy, but also a further subsidy on account of price differential claims of the oil marketing companies and refineries.
Though the international prices of petroleum products have eased a little since its peak in October 2004, nevertheless it continues to remain substantially higher than May 2004 prices.
It is in this perspective that a minor correction in the petroleum products pricing is being done. The prices of petroleum products in Pakistan, however, remain substantially lower than the neighbouring country.
Pakistan State Oil Ltd, and Shell Pakistan Ltd, raised the high-speed diesel prices by as much as 25 paisa.
On December 15, the OCAC and the oil marketing companies raised the prices by as much as 7 percent after almost seven-month freeze, resulting in loss of oil taxes and increasing the claims differential because of the subsidy.
Following are the prices in rupees and litres:
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Product New Old Increase Change %
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Motor spirit 40.39 39.50 0.89 2.25
High Octane 44.59 43.73 0.86 1.96
Kerosene oil 26.04 25.50 0.54 2.11
Light Diesel oil 22.92 22.41 0.51 2.23
High Speed Diesel 26.21 25.96 0.25 0.96
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