ISLAMABAD: In its last fuel price revision announcement before farewell, the caretaker government on Thursday increased the petrol price by Rs4.13 per litre for the next fortnight ending March 15 but left the price of high-speed diesel unchanged.

In a late-night an­­nouncement, the Ministry of Finance announced the new prices for the next fortnight, starting from March 1, as recommended by the Oil and Gas Regulatory Authority (Ogra).

The petrol price has gone up by 1.5 per cent with immediate effect to Rs279.75 per litre from Rs275.62 earlier. Petrol is mostly used in private transport, small vehicles, rickshaws and two-wheelers and an increase in its price directly impacts the budget of middle- and lower-middle classes.

The price of high-speed diesel was kept unchanged at Rs287.33 per litre. Since this fuel is mostly used by the transport sector, a hike in its price is considered inflationary. The fuel is used in heavy vehicles, trains and agricultural engines like trucks, buses, tractors, tube wells and threshers and particularly adds to the prices of vegetables and other eatables.

The government did not announce the prices of kerosene and light diesel oil. Kerosene is mostly used by unscrupulous elements, who mix it with petrol, and to some extent for lighting and heating in remote areas. Light diesel oil is consumed by flour mills and a couple of power plants.

In the international market, the prices of both major petroleum products — petrol and high-speed diesel — moved slightly both ways (10 to 50 cents per barrel) over the past fortnight, with the Pakistan State Oil (PSO) paying higher import premiums on petrol. Meanwhile, the US dollar lost about 15 paise against the rupee on Feb 28.

The price of petrol has gone up to $90.78 from $89.20 per barrel over the last two weeks, while that of high-speed diesel edged lower by about eight cents per barrel to $101.05 from about $101.13.

However, the rupee generally remained stable. The premium paid by PSO for securing product cargoes went up slightly for petrol to $10.45 per barrel this fortnight from $9.47. It remained unchanged for high-speed diesel at $6.5 per barrel.

Petroleum and electricity prices have been the key drivers of a high Consumer Price Index-based inflation, recorded at 28.3pc in January. The seven-month average inflation increased to 28.7pc from 25.4pc in the same period last year.

At present, the government is charging about Rs82 per litre tax on both petrol and high-speed diesel. Although the general sales tax is zero on all petroleum products, the government charges Rs60 per litre petroleum development levy on both products.

The government also charges about Rs17-20 per litre customs duty on petrol and high-speed diesel.

On the other hand, it is charging Rs50 per litre tax on high-octane blending component and 95 research octane number (RON) petrol.

Petrol and high-speed diesel are the major revenue spinners for the government, with their monthly sales hovering at 700,000 to 800,000 tonnes compared to just 10,000 tonnes of monthly demand for kerosene.

Published in Dawn, March 1st, 2024

Follow Dawn Business on Twitter, LinkedIn, Instagram and Facebook for insights on business, finance and tech from Pakistan and across the world.

Opinion

Editorial

X post facto
19 Apr, 2024

X post facto

AS has become its modus operandi, the state is using smoke and mirrors to try to justify its decision to ban X,...
Insufficient inquiry
19 Apr, 2024

Insufficient inquiry

UNLESS the state is honest about the mistakes its functionaries have made, we will be doomed to repeat our follies....
Melting glaciers
19 Apr, 2024

Melting glaciers

AFTER several rain-related deaths in KP in recent days, the Provincial Disaster Management Authority has sprung into...
IMF’s projections
Updated 18 Apr, 2024

IMF’s projections

The problems are well-known and the country is aware of what is needed to stabilise the economy; the challenge is follow-through and implementation.
Hepatitis crisis
18 Apr, 2024

Hepatitis crisis

THE sheer scale of the crisis is staggering. A new WHO report flags Pakistan as the country with the highest number...
Never-ending suffering
18 Apr, 2024

Never-ending suffering

OVER the weekend, the world witnessed an intense spectacle when Iran launched its drone-and-missile barrage against...