ISLAMABAD: As of February 1, 2024, the outgoing caretaker government is anticipated to implement an increase in petroleum product prices for the first half of the following month, as reported by Private Media.
The surge is expected to raise petrol prices by Rs7.85 per litre and high-speed diesel (HSD) by Rs2.06 per litre, primarily attributed to heightened tensions in the Middle East due to the Israeli bombardment of Gaza and attacks on Yemen’s Houthis.
According to insider sources cited by The News, international markets responded sharply to the ship attacks, causing a $6 per barrel increase in motor gasoline (petrol) and a $3.7 per barrel hike in diesel prices since January 16, 2024.
International companies have reportedly raised premiums on motor spirit and high-speed diesel, resulting in the ex-refinery price of MS petrol in Pakistan rising from Rs187.74 to Rs269.94 per litre and HSD from Rs201.79 to Rs282.77 per litre.
The impact of the international price hike translates to a Rs10.60 per litre increase in petrol and Rs6.56 per litre increase in diesel (HSD) prices.
However, after adjusting for exchange rate gains, with Rs2.75 in MS and Rs4.50 in diesel per litre, the expected rise in motor gasoline prices is Rs7.85 per litre and Rs2.06 for HSD. It is speculated that kerosene prices might experience a decrease.
Presently, the government imposes a Rs60 per litre petroleum development levy (PDL) on petrol, with additional charges of Rs5.69 per litre for IFEM (Internal Fright Equalisation Margin), Rs7.87 per litre for OMCs margin, and Rs8.64 per litre for dealers’ margin.
Similarly, HSD incurs a Rs60 per litre PDL, along with Rs4.24 per litre for IFEM, Rs7.87 per litre for OMCs margin, and Rs8.64 per litre for dealers’ margin.
In the previous two weeks, the government had reduced petrol prices by Rs8 per litre to Rs259.3, while the diesel rate remained unchanged at Rs276.21 per litre.
Additionally, there was a decrease in kerosene oil and light diesel oil rates by Rs1.97 and Rs0.92 per litre in the recent revision.