Islamabad, July 13, 2024 – The citizens of Pakistan may be in for some unwelcome news at the pump as petrol and diesel prices are expected to rise significantly in the second half of July. Industry sources suggest an increase effective from July 16th, driven by rising global oil prices.
The Numbers Game
The estimates paint a picture of a potential jump of over Rs 7.60 per liter for petrol and Rs 3.50 per liter for high-speed diesel (HSD). This price hike, if implemented, would be for the next two weeks and comes on the heels of a previous increase on June 30th.
Global Factors at Play
The finger of blame points towards the international market, where both petrol and HSD prices have witnessed a significant rise in the past fortnight. Sources report a jump of around $4.4 per barrel for petrol and $2 per barrel for HSD. This global trend, coupled with a slight depreciation of the Pakistani rupee, is seen as the primary driver behind the potential domestic price hike.
Taxing Times
The recent decision of Pakistan to raise the maximum limit of the petroleum development levy (PDL) to Rs 70 per liter further complicates matters. This move aims to increase tax revenue on fuel but also puts additional pressure on consumer wallets.
A Look Back
It’s worth noting that the current situation follows a period of relative relief. Between May 1st and June 15th, both petrol and HSD prices saw a decrease of around Rs 35 and Rs 22 per liter, respectively in Pakistan. However, the recent global oil price surge seems to have reversed this trend.
Impact on Inflation and Transportation
Rising fuel prices are a major concern due to their inflationary impact in Pakistan. Petrol, heavily used in private vehicles and smaller transportation options like rickshaws, becomes more expensive, affecting daily commutes. Similarly, a diesel price increase can have cascading effects, pushing up prices of essential goods like vegetables due to higher transportation costs.
The Final Call
While these are estimates, the final decision on price adjustments rests with the government of Pakistan. However, with global oil prices showing no signs of immediate retreat, the citizens of Pakistan may need to brace themselves for a potential hike at the gas station in the coming days.