SANGAM PRASAIN
KATHMANDU, FEB 23 -
The Nepal Oil Corporation (NOC) has proposed the Ministry of Supplies revise the existing price of petroleum products in line with the international market price International fuel price soared to a whooping $106 a barrel on Tuesday following the Libyan uprising.
The corporation has proposed Rs 10.73 per litre hike in petrol rate and Rs 17. 24 per litre increase in aviation turbine fuel (ATF) rate, saying that the existing price would inflate its losses and induce short supply.
The corporation said only an immediate price hike could ensure smooth supply, as the existing price would compel it to cut down gasoline import. According to NOC sources, the corporation had curtailed gasoline import by 25 percent on Monday. With the current international price, increased import means increased losses for NOC.
The state-owned oil monopoly has also proposed the government to waive taxes on diesel and LP gas until the international price drops. It has also proposed the government to adjust the petrol price in line with Raxaul price and ATF price in line with Kolkata price. Petrol price in Raxaul is Rs 97.23 per litre, while ATF costs Rs 97.24 per litre in Kolkata, according to the corporation.
The NOC has estimated its February losses at Rs 1.13 billion. The corporation said it is incurring a loss of Rs 5.59 per litre in petrol and enjoying a profit of Rs 11.43 per litre in ATF.
Currently, consumers are paying Rs 88 per litre for petrol and Rs 68.50 per litre for diesel and kerosene. Normally, the country consumes 15,000 kilo litre (kl) of petrol and 70,000 kl of diesel every month. However, according to NOC, in the first half of February, it imported 9,000 kl of petrol and 39,000 kl of diesel, much higher than the normal consumption. NOC General Manager Digambar Jha fears that the significant rise in gasoline consumption could result in severe fuel shortage. As per the current rate, petrol and diesel import could reach 18,000 kl and 80,000 kl per month, respectively.
“We have proposed the price revision to ensure smooth supply,” said Jha, adding that increased load-shedding hours have also increased gasoline demand. If the government will not be serious in this issue, there may be a severe fuel shortage soon.
The NOC on Dec 6, 2010 had hiked the prices of major petroleum products, making petrol, diesel and kerosene each dearer by Rs 3 per litre and LP gas by 75 per cylinder.
