The Ministry of Finance has issued a notification regarding the new prices of petroleum products, bringing both good and bad news for consumers. According to the notification, the petrol price in Pakistan has been increased by Rs. 9.66 per liter, reaching a new price of Rs. 289.41 per liter.
On the other hand, there’s a sigh of relief for diesel users as its price has been reduced by Rs. 3.32 per liter, now standing at Rs. 282.24 per liter. These adjustments in fuel prices will come into effect from tonight at 12 AM.
This notification reflects the ongoing fluctuations in global oil markets and their impact on domestic prices. While the increase in petrol prices may burden consumers, the reduction in diesel prices could offer some respite.
Reason Behind The Move
The driving force behind this move, or what prompted the newly established government to announce such a substantial hike in petrol prices, is primarily attributed to the International Monetary Fund (IMF) recommendation to reintroduce an 18% general sales tax (GST) on petrol as a condition for the release of the final tranche of its bailout package.
Additionally, there have been reports indicating that the government intends to raise the petroleum levy from Rs. 60 to Rs. 100. The Petroleum Development Levy has witnessed various adjustments in recent years, with a notable increase during the fiscal year 2023.
Initially set at Rs. 20 per liter in July 2022, the petroleum levy on petrol was subsequently raised to Rs. 50 per liter in November 2022, and further escalated to Rs. 60 per liter until September 2023.
Currently, the government is imposing a development levy of Rs. 60 per liter on both petrol and diesel, which stands as the maximum limit under the law. In determining these prices, the government takes into account factors such as the requirements of Pakistan State Oil, taxes, and global oil prices.
