In the wake of escalating tensions in the Middle East, consumers in Pakistan are bracing for a significant surge in petrol and high-speed diesel (HSD) prices. According to informed sources, petrol prices are expected to rise by approximately Rs2.50 to Rs2.80 per litre, while HSD prices could see an increase of Rs8 to Rs8.50 per litre starting Monday, April 15.
The spike in international market prices, driven by a $4 per barrel increase for petrol and a $4.50 per barrel hike for HSD, has been exacerbated by the recent escalation in the Middle East. Despite a slight improvement in the exchange rate and a decrease in the import premium for petrol, the net impact is projected to lead to higher fuel costs for consumers.
Recent data indicates that the import premium for petrol has decreased by nearly 21%, dropping to $10.7 per barrel, while the Pakistani rupee has strengthened by approximately 40 paisa against the dollar. However, the import premium for HSD remains unchanged at $6.50 per barrel.
Officials suggest that the increase in petrol prices is primarily due to a $4 per barrel rise in its international market price, reaching $98.5 per barrel, while HSD has seen a $4.50 per barrel increase, reaching $102.9.
This impending price hike comes on the heels of a previous increase in petrol prices by Rs9.66 per litre, coupled with a reduction of Rs3.32 per litre for HSD, for the fortnight ending April 15.
Notably, the Pakistani government has already reached the maximum permissible limit of Rs60 per litre in petroleum levy for both petrol and HSD. This aligns with its commitments to the International Monetary Fund, with a budget target of collecting Rs869 billion in petroleum levy for the current fiscal year. Despite a revised target of Rs920 billion by June, the government aims to collect approximately Rs970 billion by the year’s end.
Currently, consumers are subject to approximately Rs82 per litre in taxes on both petrol and HSD, further adding to the financial burden amid rising fuel prices.
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