Adviser to the finance minister, Khurram Schehzad said on Saturday the oil sector remains managed through regulation.
Speaking on Samaa TV programme “Mere Sawal with Absar Alam”said the Oil and Gas Regulatory Authority (Ogra) requires companies to maintain a stock for several days, adding that supplies are generally kept for about 20 days. “It does not happen that an order is placed today and prices fall the same day,” he said.
Schehzad said the price of oil includes several costs, including shipping, vessel insurance and the cost calculated on the day the shipment arrives. He added that the point of unloading and other logistics also form part of the total cost.
He said prices in the international market had climbed from $88 dollars to $130 a barrel, while fresh petrol supplies arrive at new rates. The price announced on March 1 reflected the previous 15 days, he said, adding that the increase recorded during eight days had begun to affect the rate.
“If there had been no war and, like during coronavirus, petrol had been reduced by Rs55, no one would have asked such questions,” he said.
Schehzad said the actual price of diesel had increased by Rs76 during the past eight days. “There is a difference of Rs76, while the increase announced stands at Rs55,” he said.
He said crude oil prices had risen by 26 per cent within three days. If petroleum product prices had not been raised, hoarding and smuggling would have followed, he added.
Referring to reforms, he said the privatisation of PIA was not a small matter and that 24 state institutions were being closed. “I use a government vehicle and the state pays for the petrol,” he said. “If oil prices rise, they will increase; if they fall, they will be reduced.”
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