Nepal: Fuel prices higher despite fall in global prices
Representative image Photograph: (AFP)
Nepal’s state-owned oil monopoly Nepal Oil Corporation (NOC) has not been implementing the automated pricing system -- under which fuel prices in the domestic market are revised in line with the price list sent by its sole supplier Indian Oil Corporation -- it launched two and a half years ago, The Kathmandu Post reports.
As a result, oil prices in Nepal are higher despite a sharp fall in global prices, forcing consumers to pay more.
NOC has also set up a price stabilisation fund to implement the auto pricing mechanism, but it has not been implementing the system fully.
The corporation says it does not slash fuel prices in line with global trends is because of the price difference in Nepal and in Indian towns across the border. According to NOC, the price difference encourages cross-border smuggling from Nepal to India.
NOC currently makes a profit of Rs 5.69 (Nepalese) per litre on petrol, Rs 1.47 per litre on diesel and Rs 17.47 per litre on kerosene, according to The Kathmandu Post.
Last week, NOC reduced petrol, diesel and kerosene prices by Rs 1.50 per litre despite a sharp fall in oil prices. The corporation’s projected profit stands at Rs800 million per month following the price revision.