Karachi, July 1, 2023: In a move that has disappointed the public during Eid ul Azha, the Pakistan government has decided to increase the levy on petrol to Rs55, instead of providing relief on petroleum prices. The decision, announced by Finance Minister Ishaq Dar, came into effect on July 1, 2023.
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Petrol pumps may not accept cash for fuel purchase in Pakistan
Pakistan is contemplating a potential restriction on cash payments for fuel purchases at petrol pumps as part of an effort to promote digitalization and curb financial irregularities.
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Today’s Petrol and Diesel prices in Pakistan as of April 28, 2023
As of April 28, 2023, the prices of petroleum products in Pakistan are as follows: MS (Petrol) – Rs282 per liter, High Speed Diesel Oil (HSD) – Rs293 per liter, Kerosene (SKO) – Rs186.07 per liter, and Light Diesel Oil (LDO) – Rs174.68 per liter.
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Pakistan nears to provide low-priced petrol
KARACHI: Pakistan has prepared working for provide low-priced petrol to lower-income group of the society, a minister said on Wednesday.
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Pakistan keeps prices of petrol, HSD unchanged till December 15, 2022
ISLAMABAD: Pakistan on Wednesday kept the prices of petrol and high speed diesel (HSD) for next fortnight starting December 01, 2022.
However, the prices of kerosene oil and light speed diesel (LDO) reduced by Rs10 per liter and Rs7.5 per liter, respectively.
READ MORE: Pakistan to decide petroleum prices effective from December 01, 2022
Finance Minister Ishaq Dar in a press conference announced the revision in petroleum prices for the period December 01 to 15, 2022.
Previously, on September 30, 2022 the government made changes in petroleum prices.
READ MORE: Pakistan may impose petroleum tax to avert revenue shortfall
The new prices of petroleum products for next fortnight will be as follow:
The prices of petrol and HSD shall be Rs224.80 per liter and Rs235 per liter, respectively.
However, the rate of kerosene shall be reduced by Rs10 to Rs181.83 per liter from Rs191.83. Similarly, the price of LDO shall be reduced by Rs7.50 to Rs179 per liter from Rs186.50.
READ MORE: Petroleum prices in Pakistan for next fortnight effective from November 16, 2022
The benchmark Brent crude oil ended at $83.19 a barrel on November 28, 2022, having slumped more than 3 per cent to $80.61 earlier in the session for its lowest since January 4, 2022.
The Brent crude has hit above $120 per barrel during mid-June this year and now fell to the present level leaving ample room to the present government to revise downward the prices to provide relief the domestic consumers.
READ MORE: Petroleum prices in Pakistan effective from November 01, 2022
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Pakistan may impose petroleum tax to avert revenue shortfall
ISLAMABAD: Pakistan likely to impose tax on petroleum products to avert imminent shortfall in revenue collection.
Reports suggested that the Federal Board of Revenue (FBR) – the apex tax collecting agency of the country – is anticipating massive revenue shortfall in coming months due to no tax on petroleum products besides slowdown in economic activity.
Reportedly, the FBR may face about Rs500 billion as shortfall in the current fiscal year.
After the first quarter (July – September) 2022/2023, the FBR claimed to present extraordinary performance in revenue collection. “This performance in revenue collection is despite zero rating of Sales Tax on POL products, import compression and the prevailing situation of floods,” the FBR said in a press release.
READ MORE: Petroleum prices in Pakistan for next 10 days; what next?
Experts believed that the imposition of sales tax on petroleum products would increase the retail prices as well as result in high inflation.
At present the prices of petroleum products till November 30, 2022 are: price of petrol is Rs224.80 per liter; high speed diesel Rs235.30 per liter; kerosene oil Rs191.83; and light diesel oil Rs186.50 per liter.
In the latest review on November 15, 2022 the government decided to keep the prices unchanged for the fortnight ending November 30, 2022.
It was third straight announcement to keep the prices of petroleum products unchanged. Previously, on September 30, 2022 the government made changes in petroleum prices.
Experts said that the rise in petroleum prices were imminent in the next review as the government was under immense pressure from the IMF to impose sales tax on petroleum products.
At present the government adopted a policy to keep zero sales tax on petroleum products instead flat rate of 17 per cent. Furthermore, the government also committed to apply petroleum levy to generate more revenue for curtailing budget deficit.
READ MORE: Petroleum prices in Pakistan for next fortnight effective from November 16, 2022
Besides, the exchange rate is again showing a deterioration in rupee value against the dollar. The US dollar continued to make gain for seventh straight session against the Pakistani Rupee (PKR) on November 25, 2022 and reached PKR 223.94 in the interbank foreign exchange market.
The latest import data showed that the petroleum prices were on the higher sides as the country spent more money for import of lesser quantity of petroleum products.
The imports of petroleum products recorded a decline 1.75 per cent to $2.84 billion during July – October of fiscal year 2022/2023 as compared with $2.89 billion in the corresponding period of the last fiscal year.
However, import of petroleum crude recorded an increase of 6.61 per cent to $1.73 billion during the period under review as compared with $1.62 billion in the corresponding period of the last fiscal year.
Interestingly, quantities of both the segments fell 34.43 per cent and 23.26 per cent during the first four months of the current fiscal year, showing surge in prices of the international prices.
Although the present government has kept the prices during last three review under political pressure. But considering the present scenario of fiscal deficit and IMF pressure the government may take tough decision in coming days.
READ MORE: Petroleum prices in Pakistan effective from November 01, 2022
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Pakistan petroleum prices to go up with sales tax imposition
The prices of petroleum products in Pakistan will go up with the imposition of sales tax, which presently at zero per cent.
Analysts AKD Research Tuesday stated that with the IMF consistently conveying concerns over possible shortfall on account of petroleum development levy (PDL), the government is looking towards a contingency plan by taking up additional taxation measures, for one, imposing full 17 per cent general sales tax (GST) on petroleum products.
READ MORE: SSGC stops gas supply to industries under load management plan
To note, sales tax collection from the previous fiscal year stood Rs107 billion, against Rs235 billion in the preceding fiscal year, reflecting a decrease of 54 per cent.
With petroleum products sales remaining robust during fiscal year 2021-2022, the halving of the collection was due to sales tax being effectively zero during the second half of the fiscal year, since mid-January more specifically.
READ MORE: Pakistan has sufficient stock of fuel to meet domestic demand
Assuming moderate 8 per cent imposition (Rs16-20 per liter) of sales tax on retail fuel products, the government could fetch additional around Rs30 billion revenue monthly at these rates.
Furthermore, the government is likely to take a major hit in the non-tax revenue department as well i.e. PDL as retail offtakes have continued to decline during first four months of the current fiscal year, down 22 per cent year on year (YoY).
READ MORE: ECC approves raising petroleum levy to Rs50 per liter on RON 95
Total collection during the four months were estimated at Rs115 billion against the budgeted target of Rs250 billion. To note, annual PDL collection target stands at Rs750 billion (Rs62.5 billion per month).
Assuming unchanged trends in POL offtakes and similar rates, total PDL collections will end the current fiscal year at Rs350 billion, an overall shortfall of Rs400 billion.
READ MORE: Petroleum sales decrease by 22% in four months of 2022-2023
The analysts further said that assuming the government pushes through by imposing further levies/taxes, although inflationary, this target may be more achievable now compared to five months ago, as falling global oil/petroleum prices has given the authorities more space to work with without severely hurting end consumers.
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Pakistan has sufficient stock of fuel to meet domestic demand
ISLAMABAD: Pakistan has sufficient stock of fuel to meet the domestic requirement of the country, an official statement said on Tuesday.
The statement has clarified the news reports circulated regarding fuel shortage. It said the reports are baseless and contrary to facts.
On November 7, 2022 the petrol stocks are around 550,000 Metric Tons which is sufficient for 21 days and with regard to diesel the present stocks are 438,000 Metric Tons which is adequate for 15 days, based on Oil Companies Advisory Council’s (OCAC) stock position.
PSO’s planned import of diesel for the month of November 2022 is around 220,000 metric Tons out of which one cargo is on the way to Karachi and is expected to arrive on November 12,2022 while cargoes of other OMCs are in line to meet the country’s planned demand.
Keeping in view the above position, the stock in the country is sufficient to take care of current requirements, it added.
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Petroleum prices in Pakistan effective from November 01, 2022
ISLAMABAD: The government of Pakistan on Monday decided to keep the petroleum prices unchanged for next fortnight starting from November 01, 2022.
Finance Minister Ishaq Dar announced the decision to keep the prices unchanged for next 15 days.
“The government has decided to keep the prices of Petrol, High Speed Diesel, Light Diesel, and Kerosene Oil unchanged for next 15 days”, Ishaq Dar said.
It was second straight announcement to keep the prices of petroleum products unchanged. Previously, on September 30, 2022 following changes in petroleum prices were announced:
READ MORE: Pakistan keeps petroleum prices unchanged from October 16, 2022
The rate of petrol has been reduced by Rs12.63 per liter to Rs224.80 from Rs237.43.
The price of high speed diesel has been cut by 12.13 per liter to Rs235.30 from Rs247.43.
The rate of Kerosene oil has been slashed by Rs10.19 to Rs191.83 from Rs202.02.
The price of light diesel oil has been reduced by Rs10.78 to Rs186.50 from Rs197.28.
The government has taken the latest decision amid challenges including long march initiated by leading opposition party and rising benchmark Brent crude rates in international markets.
READ MORE: Pakistan sharply reduces petroleum prices from October 01, 2022
The present coalition government led by PML-N is under immense pressure since coming into power in April 2022. This government is mainly criticized for sky rocket prices of all essential items bringing inflation to record levels. The present government had opportunity to attract masses by lowering petroleum prices.
On the other hand, Imran Khan, Chairman, Pakistan Tehreek I Insaaf (PTI) launched long march on October 28, 2022 from Lahore demanded the present government to announce general election as the country on the brink of default and masses were witnessing the brunt of high prices.
The present government has annoyed people through its last decision to keep the prices of petroleum products unchanged. Experts had opinion that the government had room to give benefit by slashing the prices.
The experts believed that now the government would have fewer options to cut the prices of petroleum products due to rising global oil prices and depreciation in currency value at home.
Benchmark US Brent soared to $95.77 per barrel as of October 28, 2022. The commodity witnessed an increase of over $5 during the month of October 2022.
Pakistan is the net importer of petroleum products to meet the domestic demands. Oil import bill of the country went up to $4.86 billion during first quarter (July – September) of the current fiscal year as compared with $4.59 billion in the corresponding quarter of the last year.
READ MORE: Pakistan reviews petroleum prices on Sept 30, 2022 amid crash in global rates
On the other hand the rupee once against started depreciation due to political instability and falling foreign exchange reserves. Although, the SBP recently received $1.17 billion from the International Monetary Fund (IMF) to buffer its foreign exchange reserves and support the local currency. Yet the scheduled repayment gradually dry to foreign exchange reserves position.
Most recently, the SBP again received $1.5 billion from the Asian Development Bank (ADB) to strengthen the foreign exchange reserves position. However, the repayment pressure and rising political noise the rupee unable to show resistance against the dollar.
The previous government of PTI had kept both the petroleum levy and sales tax at zero in order to provide relief to the masses. The PTI government also provided a huge subsidy on prices of petroleum products in order to lower the rates and provide relief to the masses.
READ MORE: New petroleum prices in Pakistan effective from September 21, 2022
However, former Prime Minister Imran Khan was removed through a vote of no-confidence motion on April 10, 2022. Since then the new coalition government led by PML-N increased the prices of petroleum products sharply on three different occasions.
The present government in the budget estimated to collect Rs855 billion as petroleum levy during the fiscal year 2022/2023. As this fiscal year is starting from July 01, 2022, it is likely that the government will opt to impose the levy from this date.
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Pakistan reviews petroleum prices for next fortnight amid PTI’s long march
ISLAMABAD: Pakistan is set to review petroleum prices on October 31, 2022, as the government is facing challenges including long march initiated by leading opposition party and rising benchmark Brent crude rates in international markets.
The present coalition government led by PML-N is under immense pressure since coming into power in April 2022. This government is mainly criticized for sky rocket prices of all essential items bringing inflation to record levels. The present government has opportunity to attract masses by allowing sharp cut in petroleum prices for the next fortnight starting from November 01, 2022.
READ MORE: Pakistan keeps petroleum prices unchanged from October 16, 2022
On the other hand, Imran Khan, Chairman, Pakistan Tehreek I Insaaf (PTI) launched long march on October 28, 2022 from Lahore demanded the present government to announce general election as the country on the brink of default and masses were witnessing the brunt of high prices.
The present government has annoyed people through its last decision to keep the prices of petroleum products unchanged. Experts had opinion that the government had room to give benefit by slashing the prices.
However, the prices were kept unchanged from October 16, 2022 at the level of October 01, 2022. Previously, on September 30, 2022 following changes in petroleum prices were announced:
The rate of petrol has been reduced by Rs12.63 per liter to Rs224.80 from Rs237.43.
The price of high speed diesel has been cut by 12.13 per liter to Rs235.30 from Rs247.43.
The rate of Kerosene oil has been slashed by Rs10.19 to Rs191.83 from Rs202.02.
The price of light diesel oil has been reduced by Rs10.78 to Rs186.50 from Rs197.28.
READ MORE: Pakistan sharply reduces petroleum prices from October 01, 2022
The experts believed that now the government would have fewer options to cut the prices of petroleum products due to rising global oil prices and depreciation in currency value at home.
Benchmark US Brent soared to $95.77 per barrel as of October 28, 2022. The commodity witnessed an increase of over $5 during the month of October 2022.
Pakistan is the net importer of petroleum products to meet the domestic demands. Oil import bill of the country went up to $4.86 billion during first quarter (July – September) of the current fiscal year as compared with $4.59 billion in the corresponding quarter of the last year.
On the other hand the rupee once against started depreciation due to political instability and falling foreign exchange reserves. Although, the SBP recently received $1.17 billion from the International Monetary Fund (IMF) to buffer its foreign exchange reserves and support the local currency. Yet the scheduled repayment gradually dry to foreign exchange reserves position.
READ MORE: Pakistan reviews petroleum prices on Sept 30, 2022 amid crash in global rates
Most recently, the SBP again received $1.5 billion from the Asian Development Bank (ADB) to strengthen the foreign exchange reserves position. However, the repayment pressure and rising political noise the rupee unable to show resistance against the dollar.
The previous government of PTI had kept both the petroleum levy and sales tax at zero in order to provide relief to the masses. The PTI government also provided a huge subsidy on prices of petroleum products in order to lower the rates and provide relief to the masses.
However, former Prime Minister Imran Khan was removed through a vote of no-confidence motion on April 10, 2022. Since then the new coalition government led by PML-N increased the prices of petroleum products sharply on three different occasions.
The present government in the budget estimated to collect Rs855 billion as petroleum levy during the fiscal year 2022/2023. As this fiscal year is starting from July 01, 2022, it is likely that the government will opt to impose the levy from this date.
READ MORE: New petroleum prices in Pakistan effective from September 21, 2022