Islamabad, February 13, 2024 – As Pakistan navigates economic considerations, the caretaker government is contemplating a potential increase in petroleum prices for the upcoming fortnight starting from February 16, 2024.
While petrol prices are expected to remain unchanged, High-Speed Diesel (HSD) may witness an upward adjustment by Rs8 per litre, subject to premium and exchange rate fluctuations.
Petroleum Price Adjustments:
The interim government is considering a hike in HSD prices from the current Rs285 to Rs293 per litre, attributing the potential increase to adjustments in premiums and exchange rates. The decision is expected to be implemented on February 16, 2024, pending further assessment of economic factors.
Premium and Exchange Rate Adjustments:
Pakistan State Oil (PSO) has reported a $9.43 per barrel premium on petrol and $6.50 per barrel on HSD. While petrol premium has decreased slightly from $9.47 in the last fortnight, HSD’s premium remains stable. Exchange rate adjustments are estimated at 50 paisa for petrol and Rs1.70 per litre for HSD, contributing to the potential increase in fuel prices.
Kerosene Oil and Light Diesel Oil (LDO):
In an effort to maintain stability, the government is anticipated to keep kerosene oil prices steady while considering a Rs2.50 per litre increase in the rate of light diesel oil (LDO).
Calculation Methodology:
The calculations for the proposed petroleum prices are grounded in the current rates of petroleum levy (PL) and general sales tax (GST). The government is carefully weighing these factors to strike a balance between economic considerations and consumer affordability.
Global Oil Market Dynamics:
The rise in Brent crude oil prices to $83 per barrel from $81.55 since February 1 is a contributing factor to the contemplation of price adjustments. Additionally, HSD prices have surged by approximately $3 per barrel in the same period.
Oil and Gas Regulatory Authority (Ogra) Considerations:
While the Oil and Gas Regulatory Authority (Ogra) is yet to finalize the recommended fuel prices for the first half of February, its calculations take into account monthly tax targets, estimated fuel consumption, and the supply cost of Pakistan State Oil (PSO).
As Pakistan approaches a potential petroleum price adjustment, the caretaker government is mindful of the delicate balance between economic realities and the impact on consumers. The decision to maintain petrol prices and potentially increase HSD prices reflects the government’s commitment to responsible economic management amid global market fluctuations. Consumers and stakeholders await the official announcement from the authorities as they continue to monitor the evolving situation in the energy sector.
