Officials say no increase in levy, impact to be passed to consumers
The Pakistan government will likely have no choice but to raise fuel prices by up to 9% for the next fortnight if the current upward trend of global crude oil rates persists.
Data received from refineries and oil marketing companies revealed that the prices of diesel and petrol have gone up since the last revision in domestic product rates.
The documents showed that the price of petrol was up by 7% or $5.52 to $85.23 a barrel in the global market while diesel price went up by 10% or $7.89 to $90.19 a barrel.
The prices of finished products rose sharply following a steep rise in crude oil prices.
Global crude oil prices are hovering near a five-month high this Wednesday, driven by mounting anxieties over a potential deeper involvement of the United States in the escalating conflict between Israel and Iran. This surge in oil, coupled with a decline in Asian equities, paints a cautious picture for global markets.
West Texas Intermediate (WTI) crude, the U.S. benchmark, saw an early rise of as much as 1.1% in Asian trading today, building on a significant 4% jump experienced on Tuesday.
The government recently increased the petroleum product prices — diesel saw the largest increase, rising by PKR 7.95 per liter to PKR 262.59 per liter while petrol also saw a hike of PKR 4.80 per liter, climbing to PKR 258.43 per liter.
The petroleum development levy (PDL) on diesel is PKR 77.01 per liter and that on petrol and high-octane is PKR 78.02.
Pakistan's Secretary Finance Imdadullah Bosal, while briefing the National Assembly Standing Committee on Finance recently, said that the government will not increase the PDL. However, it will pass on the impact of increase in oil prices directly to consumers.
The government is targeting a collection of PKR 1.486 trillion from PDL in fiscal year 2025-26.
Finance Minister Muhammad Aurangzeb also endorsed the secretary finance’s statement while saying that the government will be very decisive in this regard.
Aurangzeb confirmed that the prime minister has formed a high-level committee to assess the situation.
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