Sunday, January 2, 2011

People’s govt gives nation gift of petrol bomb on New Year

 People’s govt gives nation gift of petrol bomb on New Year

 ISLAMABAD: The government on Friday gave a New Year gift by dropping a petrol bomb on the 170 million people of the country, increasing the POL prices by 5.4 to 9 per cent.

The price of petrol was increased by Rs6.71 per litre from Rs72.96 to Rs79.67 per litre, diesel by Rs4.25 per litre from Rs78.33 to Rs82.58, High Octane Blending Content (HOBC) by Rs7.79 per litre from Rs86.67 to Rs94.24, light diesel by Rs4.36 per litre and kerosene oil by Rs4.04 per litre.

The massive increase in the POL product prices will increase the existing inflation. The increase in petroleum prices, particularly in diesel, will also lead to a massive increase in transportation cost of everything, particularly the kitchen items, making the life of common man more miserable.
With continuous increase in inflation that is hovering around over 15 per cent, the purchasing power of the masses has eroded to a large extent while the political leadership seems indifferent to their problems.

As usual, sale of petrol and diesel was suspended at many petrol pumps across the country on Friday soon after reports of the rise in prices of petroleum products. Reacting with the highest degree of ire, the common people have rejected the government’s move, saying it will unleash a new tsunami of price hike.
Meanwhile, a spokesperson of the Ministry of Petroleum and Natural Resources explained that the increase in prices of petroleum products was due to a hike in the international market and its impact on domestic pricing. According to a fact sheet issued by the Ministry, the oil share in the total energy mix of the country was around 30.5% during the year 2009-10.

The fact sheet says: The annual demand of petroleum products in the country is about 20 million tons (400,000 barrels per day) out of which only 13 per cent is being met through the local resources while the balance 87 per cent is met through import in the shape of crude oil and deficit refined petroleum products like motor spirit, high speed diesel, furnace oil, etc.

The import volumes of crude oil, HSD and furnace oil were 7.0 million tons, 4.6 million tons and 6.6 million tons respectively during the year 2009-10 for which the import bill was around $10 billion.

The estimated import volumes of crude oil, HSD and furnace oil are 8.4 million tons, 4.0 million tons and 9.0 million tons respectively for the year 2010-11 for which the import bill is estimated to be around $12 billion. Local crude price is also linked to the international market prices.

As such, the total oil demand of the country is based on the international market prices, and hence the impact of price hike in international market hit the prices of local petroleum products.

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