ISLAMABAD, Dec 13: The petroleum ministry on Thursday projected oil import bill at $11 billion for the current year — up 40 per cent as compared to last year — and pleaded before the president to allow a Rs-2 per litre increase in POL prices every fortnight to avert a serious economic crisis.

President Pervez Musharraf, who presided over the three-hour meeting during which was discussed the country’s lowest ever oil stocks and economic problems arising out of a continued freeze on petroleum products’ prices, however, reserved his opinion and informed the caretaker authorities that a decision would be conveyed to them in a day or two, informed sources told Dawn.

Caretaker Prime Minister Mohammedmian Soomro, petroleum minister Ahsanullah Khan, petroleum secretary and other senior officials attended the meeting. In the same meeting, a team of agriculture ministry gave a presentation on wheat and flour crisis in the country.

The president was informed that the differential between domestic and international diesel and kerosene prices had gone beyond Rs15 and 18, respectively, resulting in the addition of Rs14 billion liability every month. He was told that international prices had been reduced in the first fortnight of December, thereby reducing the price differential to about Rs14 and 16 per litre diesel and kerosene, respectively.

Even then, the additional burden would keep on increasing in excess of Rs10 billion every month.

However, an increase in the prices of almost all products by Rs2 per litre on December 15 would help reduce the diesel and kerosene price differential to an average Rs13 per litre. Another Rs2 per litre increase on January 1, 2008 would reduce the difference to less than Rs10 per litre on average.

The meeting was also informed that petroleum development surcharge on petrol (motor spirit) that used to be Rs15 at one point of time had now reduced to less than Re1 per litre and the cushion coming from petrol and HOBC was no more available.

“The presentation went very well and the president seemed convinced about what the petroleum ministry officials wanted to convey”, said a senior official who attended the meeting.

He said the petroleum ministry explained that it would take about four months to take domestic POL prices to the level of international prices. The official said the major problem was coming out of the diesel prices, which had the largest share in overall petroleum consumption but some adjustment in other POL rates may be made as well.

About 7.5 million tons of diesel was consumed in the country, as against a total oil consumption of 17.5 million tons last year. Furnace oil had the second largest share and remains in the range of 5-7 million tons depending upon power production requirements.

The president was informed that the government had estimated an import bill of $8.8 billion for the current year at an expected international crude oil rate of $70 per barrel. However, the international prices touched $100 before coming down to less than $90 per barrel at present, the official said.

Last year, the oil import bill had stood at $7.88 billion.