Surprise fuel hike adds to burden on consumers
Intelligence report synthesized for precision. Verified source updates below.
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The IMF’s executive board is expected to approve in the first half of May the disbursement of more than $1.2 billion under two ongoing programmes.
As of April 23, diesel prices were estimated to go down by around Rs25 per litre and petrol by Rs6 per litre. However, the government partially restored the petroleum levy on diesel and increased petrol prices to meet overall fiscal targets.
Unlike the prime minister’s announcements of price cuts, the increase this time was quietly announced by the petroleum division on the day Iran and the United States dispatched their negotiators to Islamabad for the second round of talks.
Petrol, diesel prices raised by Rs27 per litre
As such, the ex-depot price of high-speed diesel (HSD) was fixed at Rs380.19 against Rs353.42 per litre at present, up by 7.6pc or Rs26.77 per litre.
The diesel price has come down from a peak of Rs520.35 on April 10 as the prime minister removed the petroleum levy for two weeks but then allowed partial recovery, sources said. HSD is considered the most inflationary item due to its widespread use in freight transportation.
Likewise, the ex-depot rate of petrol was set at Rs393.35 per litre for the coming week, up from Rs366.58 per litre, an increase of Rs26.77 or 7.3pc.
With the latest revision, the government is now charging around Rs135 per litre in taxes on petrol and Rs65 per litre on diesel, including petroleum levy, customs duty and the climate support levy.
On Friday, the government increased the petroleum levy on petrol by about Rs27, raising it from Rs80 to Rs107.38 per litre, while the levy on high-speed diesel was kept at zero at the retail level under the latest notification.
In a written statement, Petroleum Minister Ali Pervez Malik said oil prices were again rising due to regional tensions and the government had to take measures to pass on the additional burden to consumers in view of agreements with international stakeholders.
He said the government absorbed the increase in international prices for as long as possible with its limited resources and provided “historic relief” to the people.
Petrol and diesel rates have gone up from Rs266 and Rs281 per litre, respectively, after the US-Israel attacked Iran on Feb 28, sending shockwaves to the global energy markets.
The two fuels remain the government’s key revenue generators, with combined monthly sales of around 700,000 to 800,000 tonnes compared to about 10,000 tonnes for kerosene.
