The government on Thursday announced a significant hike in the price of petrol, increasing it by Rs 4 per liter, bringing the cost to an all-time high of Rs 127.30 per liter. This marks the highest petrol price in Pakistan’s history. The new prices, along with adjustments to other petroleum products, will take effect from October 1, 2021.
According to a statement from the Finance Ministry, the price of high-speed diesel (HSD) has also been increased by Rs 2 per liter, raising it from Rs 120.04 to Rs 122.04. Kerosene oil saw a more substantial rise of Rs 7.05 per liter, from Rs 92.26 to Rs 99.31. Similarly, light diesel oil (LDO) prices were hiked by Rs 8.82 per liter, moving from Rs 90.69 to Rs 99.51.
Despite the significant surge in international oil prices, the government claims it has limited the increase in domestic petrol prices by adjusting the sales tax and petroleum levy. “The government has absorbed the higher international pressure of prices through reduction in petroleum levy and sales tax,” the official statement noted.
The statement explained that the Oil and Gas Regulatory Authority (OGRA) had calculated even higher price increases due to rising international oil prices and exchange rate fluctuations over the past two weeks. However, Prime Minister Imran Khan decided to pass on the minimum possible increase to consumers.
“The government has made the adjustment in petroleum levies and sales tax to minimize the impact on consumers,” read the statement. It further emphasized that despite the price hike, petroleum prices in Pakistan remain the lowest in the region.
The new prices will be applicable for the next fortnight, after which they may be revised again depending on international market trends and currency exchange rates.
The latest increase in fuel prices is expected to put additional pressure on consumers and businesses already dealing with rising inflation and an unstable exchange rate. The cost of fuel is a major contributor to inflation, as it impacts transportation and production costs across sectors, leading to increased prices for goods and services.
This announcement comes amid ongoing economic challenges, with the government striving to balance between stabilizing the economy and addressing global market pressures.
