Pakistan sharply increases petroleum prices ahead of scheduled announcement

Pakistan sharply increases petroleum prices ahead of scheduled announcement

Pakistan on Sunday increased sharply the prices of petroleum products ahead of scheduled announcement that was on January 31, 2023.

The prices of petrol and high speed diesel (HSD) have been increased by Rs35 per liter each and the rates of kerosene oil and light diesel oil (LDO) have been increased by Rs18 per liter each, according to an announcement by Finance Minister Ishaq Dar.

READ MORE: Pakistan may review petroleum prices ahead of schedule to defuse panic

The finance minister said that the new prices have been implemented from 11:00 AM on January 29, 2023.

The new prices of petroleum products with effective from 11:00 AM January 29, 2023 are: petrol Rs249.80 per liter; high speed diesel Rs262.80 per liter; kerosene oil Rs189.83 per liter; and light speed diesel Rs187 per liter. reported that the government would opted to make an early announcement to defuse panic at fuel stations.

READ MORE: Pakistan decides not to increase petroleum prices till Jan 31

Reportedly, many fuel stations in many parts of the country have closed supply to make money on the back of expected price raise in petroleum prices.

Some private TV channels have shown footages of fuel stations without petrol. Whereas people were shown in long queue on those fuel stations which were serving.

There was consensus amongst economists and industry experts that the government would announce a phenomenal increase in prices of petroleum products after the rupee crashed against the dollar.

READ MORE: Pakistan maintains petroleum prices for first fortnight of 2023

The foreign currency market witnessed that the Pakistan Rupee (PKR) recorded steep fall against the dollar during last two days i.e. January 26 and 27.

The local currency devalued by PKR 31.71 or 14 per cent against the dollar during past two days and closed at PKR 262.60.

Industry sources said that considering the panic the government may make any announcement related to petroleum prices to defuse the tension. Some said that the government might not increase the price in its first announcement but it might raise in few days later.

READ MORE: Pakistan may surprise in next petroleum price revision on Dec 31

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.

Reportedly, the government is planning to introduce mini budget for generating additional PKR 280-300 billion as demanded by the IMF. Which may also include imposition of sales tax on petroleum products.

The IMF loan program under Extended Fund Facility (EFF) was stalled for the past many months and it derailed external position of the country.