Federal govt and PML-N agree to subsidise oil, increase CNG price

CNGThe federal govt and the PML-N decided on Tuesday to give Rs15 billion subsidy on oil prices over the next 3 months. As a result, there may not be any increase in rates from March 1.

In return, the cost of CNG will be raised by about Rs6 per kg to partially offset the effect of lower income on high speed diesel, petrol and kerosene oil and to sustain a CNG-petrol cost parity of about 60 %.This was the result of a gathering of a special committee of the National Assembly on oil rates presided over by Water and Power Minister Syed Naveed Qamar. The conference was attended by Prime Minister’s Adviser on Finance Dr Abdul Hafeez Shaikh, secretaries of finance and petroleum and chairman of the Oil and Gas Regulatory Authority.

Officials says when CNG costs were raised last time, its prices were about 65 percent of petrol. The petrol rates had raised twice since then, widening the space between the 2 fuels to nearly 50 %. With new increase in CNG it’d still be 40 % less expensive than petrol, he mentioned.

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