Petrol and Diesel Prices Increase in Pakistan

Jawad

30 Jun 2024

265

Petrol and Diesel Prices Increase in Pakistan

After four consecutive reductions, petrol prices in Pakistan have surged by Rs. 7.45 per liter. The new price is now Rs. 265.61 per liter, up from the previous Rs. 258.16 per liter. Similarly, the price of diesel has been revised to Rs. 277.45 per liter, marking an increase of Rs. 9.56 per liter. These new prices are effective from July 1, 2024.

Petroleum Type	Old Price	New Price	Difference
Petrol	258.16 PKR	265.61 PKR	+7.45
High Speed Diesel (HSD)	267.89 PKR	277.45 PKR	+9.56
Light Speed Diesel (LSD)	166.86 PKR	166.86 PKR	-
Kerosene Oil	186.86 PKR	186.86 PKR	-

Reasons Behind the Increase

Media reports had earlier suggested a price hike ranging from Rs. 7 to Rs. 15 per liter due to rising international petroleum costs and the increased Petroleum Levy (PL) announced in the Budget 2024-25. The government recently raised the petroleum levy on petrol and diesel from Rs. 60 to Rs. 80 per liter, indicating a foreseeable surge in fuel prices. Prime Minister Shehbaz Sharif acknowledged this impending hike, stating that it would occur in phases rather than a single increase.

Government's Response

The current government has had to implement these increases to comply with IMF-recommended reforms aimed at securing the next loan program. This decision places an additional burden on the salaried and middle-class citizens of Pakistan. The previous Rs. 60 per liter levy was also imposed to satisfy the IMF, highlighting the government's ongoing struggle to boost revenue through taxation while reducing consumption subsidies.

Impact on Economy

The petrol price hike is expected to exacerbate the inflation rate in Pakistan, as the cost of daily commodities will likely rise, further straining the population. Reports suggest that the petrol levy will continue to increase in stages, potentially leading to more fuel price hikes in the near future. The relationship between fuel prices and inflation underscores the broader economic challenges facing the country.

What are your thoughts on the revised petrol prices in Pakistan? Do you think the government's decision is justified? Share your opinions in the comments section.

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