The paper estimates the price and income elasticity of consumer demand for petroleum products. It finds that the changes in income influence demand for all selected petroleum products. On the other hand, except for avturbo and kerosene, price changes have minimal impact on the demand for the rest of the selected products. It recommends that the government consider making the taxation of petroleum products flexible during difficult times; monitor closely the oil price scheme of oil companies and check against possible transfer pricing and other anomalous practices; and continue its efforts to encourage optimal utilization of more indigenous energy resources.
