Pakistan on Thursday made the decision to maintain the current prices of petroleum products for the next 15 days, effective from June 16 until the end of the month.
Finance Minister Ishaq Dar confirmed this decision, stating that the prices would remain unchanged until June 30, 2023. The prices for various petroleum products are as follows:
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Petrol: Rs262 per liter
High-Speed Diesel: Rs253 per liter
Kerosene: Rs164.07 per liter
Light Diesel Oil: Rs147.68 per liter
This decision by the government carries significant implications due to the arrival of Russian oil and the upcoming general elections. Despite the arrival of cheaper Russian oil, the government has chosen not to adopt a populist approach to setting petroleum prices.
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The current government has faced criticism in the past for maintaining high petroleum prices. However, despite implementing two consecutive reductions, the prices of petrol and high-speed diesel have increased by 24 percent over the past year, contributing to a significant rise in inflation.
The Sensitive Price Indicator (SPI), which serves as a gauge for measuring inflation, has risen by approximately 40 percent for the week ending June 8, 2023, compared to the same period last year. This alarming increase has heightened the urgency for the government to take measures to alleviate the burden on the general public.
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In response, the government recently presented the final budget for the current legislative assembly, introducing several relief measures aimed at providing support to the masses. These measures include substantial salary and pension increases for the 2023-2024 budget year.
Experts had anticipated that the government would further reduce petroleum prices to ease the financial burden on the general public, especially with the general elections scheduled to take place within the next six months.
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Additionally, the arrival of Russian oil in Pakistan is expected to have a significant impact on local prices. Russian oil is considerably cheaper compared to international market prices. As Pakistan heavily relies on petroleum imports to meet domestic needs, the importation of Russian oil is anticipated to reduce the country’s oil import bill and contribute to a decrease in domestic market prices.
The government’s decision to maintain petroleum prices unchanged reflects a delicate balance between the economic impact of rising inflation and the potential benefits of cheaper imported oil. As the general elections draw near, the effects of this decision will be closely monitored by the public.
