Islamabad, July 14, 2023 – Pakistan is preparing to announce petroleum prices on July 15, 2023, and there is anticipation that the country may surprise its citizens with the announcement.
The decision comes as Pakistan grapples with soaring international oil prices and stringent conditions tied to the International Monetary Fund (IMF) loan program.
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The government of Pakistan revises petroleum prices twice a month, with the next announcement scheduled for July 15, 2023. These prices will remain in effect until July 31, 2023.
This announcement arrives at a critical moment as international oil prices have reached multi-month highs. At the time of writing, Brent futures settled at $81 per barrel.
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Pakistan heavily relies on petroleum imports to meet domestic demands, making the announcement of these prices particularly significant. Notably, Pakistan’s oil import bill from July to May 2022-23 declined by 22% to $15.38 billion compared to the corresponding period of the previous fiscal year’s $19.68 billion.
Despite lower international rates, the current coalition government led by PML-N has maintained higher prices in the domestic market. Therefore, the recent surge in international oil prices may impact local prices. However, the import of Russian crude oil, procured at comparatively lower rates, could potentially provide an opportunity for downward price adjustments in the local market.
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On the other hand, the government aims to generate revenue through the implementation of a petroleum levy in the fiscal year 2023-24. As of July 1, 2023, the government increased the rate of high-speed diesel by Rs7.50, resulting in a new price of Rs260.50 per liter. This adjustment reflects ongoing efforts to manage the economic landscape while considering the nation’s needs.
The implementation of the petroleum levy has significantly contributed to the recent price hike. In the previous fiscal year, the government raised the levy to Rs50 per liter for both petrol and high-speed diesel. As of July 1, 2023, the levy has been further increased to Rs60 per liter for the current fiscal year. Consequently, the likelihood of a reduction in petrol prices until July 15, 2023, has diminished due to the new levy rate of Rs55.
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Citizens of Pakistan had anticipated a decrease in petroleum prices with the arrival of cheaper Russian oil. However, these expectations remain unfulfilled, leaving the population grappling with the existing prices.
As Pakistan continues to navigate its economic landscape, the government’s decisions regarding petroleum prices will significantly impact the cost of living and overall economic conditions in the country. Citizens and industry stakeholders will closely monitor any future revisions to petroleum prices, as they continue to play a pivotal role in shaping the nation’s financial landscape.
