File photo. Asif Hassan—AFP
The interim government, late on Friday, notified a significant reduction in the prices of petroleum products, lowering petrol tariffs by Rs. 14/liter for the next fortnight.
In a notification, the Finance Division said the new prices would come into effect on the midnight of Dec. 16 and remain in place until Dec. 31, as recommended by the Oil and Gas Regulatory Authority (OGRA).
According to the notification, the consumer price of petrol has been slashed by Rs. 14/liter from Rs. 281.34/liter to Rs. 267.34/liter. Similarly, the price of high-speed diesel (HSD)—which is believed to have a significant impact on inflation due to its utility in the transport sector—was reduced from Rs. 289.71/liter to Rs. 276.321/liter, a decrease of Rs. 13.5/liter.
For kerosene oil, the notification stated its price was decreased by Rs. 10.14/liter from Rs. 201.16/liter to Rs. 191.02/liter. Also, the price of light-diesel oil was slashed by Rs. 11.29/liter from Rs. 175.93/liter to Rs. 164.64/liter.
According to industry experts, the price reduction was expected because the global prices of both high-speed diesel and petrol have declined over the past fortnight, while the rupee has largely remained stable against the U.S. dollar, facilitating the relief.
The government, earlier this year, fixed the petroleum development levy (PDL) at the maximum permissible level of Rs. 60/liter on both petrol and diesel, a key requirement of the International Monetary Fund (IMF) for revenue generation in the ongoing fiscal year.