Pakistan ready to announce new petroleum prices on March 15

Pakistan ready to announce new petroleum prices on March 15

Pakistan is ready to announce new petroleum prices as per schedule on March 15, 2023 for next fortnight March 16 – 31, 2023.

The country likely to increase the prices of petroleum products for next fortnight due to massive depreciation of Pakistani Rupee (PKR) during the period.

The local currency fell by 7.37 per cent to PKR 280.77 to the dollar at closing on March 10, 2023 as compared with PKR 261.50 on February 28, 2023. During the period the local unit hit the historic low of PKR 285.09 on March 02, 2023.

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Pakistan is net importer of petroleum products and any fluctuation in exchange rate adversely affects the prices of domestic petroleum products.

The import bill of petroleum group recorded a decline of 9.27 per cent to $10.61 billion during first eight months (July – January) 2022-2023 as compared with $11.69 billion in the corresponding months of the last fiscal year.

However, massive depreciation in rupee value, the import bill in rupee terms recorded an increase of 19.55 per cent to PKR 2.38 trillion during the period under review as compared with PKR 1.99 trillion in the same period of the last fiscal year.

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In the last announcement on February 28, 2023 the government provided some relief to the masses by reducing the prices of petroleum products, except the price of high speed diesel (HSD) which was kept unchanged.

MS PetrolRs 267 per litre
High Speed DieselRs 280 per litre
Kerosene OilRs 187.73 per litre
Light Diesel OilRs 184.68 per litre

These rates will remain applicable till March 15, 2023.

Experts believed that the government had avoided increasing the prices of petroleum products in the last announcement despite depreciation of rupee value in order to arrest inflationary pressure.

Besides, latest inflation record high readings had also compelled the government to avoid take any harsh decision.

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Previously in a statement on February 15, 2023, the finance division said that increase in price was due to Pakistani Rupee (PKR) devaluation applicable for the calculation of current pricing period.

The petroleum prices are excluded sales tax as the government kept the levy at zero per cent to provide relief to the masses. But in case addition of sales tax a massive hike is inevitable.

The normal rate of sales tax has been enhanced to 18 per cent from 17 per cent in the mini-budget, which was announced on February 15, 2023.

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The country is facing economic crisis like situation and negotiation a bailout package with the International Monetary Fund (IMF), which was stalled for the past many months.

The government has also presented mini budget for generating additional as demanded by the IMF. Which may also include imposition of sales tax on petroleum products.

Now the local authorities are hoping to finalize staff level agreement with the IMF for enabling the release of tranche to the tune of $1.2 billion.