Last Updated on: 26th June 2023, 04:54 am
Federal Govt Announces Good News For Petrol Consumers
The significant drop in world market prices for diesel could prompt the federal government to provide significant relief to citizens in the first two weeks of April.
The federal government is reportedly planning to announce a significant reduction in tank fuel prices of up to Rs 14 per liter based on the current oil tax and general sales tax, which will come into effect on April 1st.
In the current climate of high inflation, the price of High-Speed Diesel (HSD) is expected to fall by Rs 14.31 per liter, providing a much-needed respite for the general public.
Diesel plays a crucial role in the transportation and agricultural industries. Lowering the price would be particularly beneficial for farmers now that the planting season has started.
If the government opts for full-price relief for consumers, the cost of diesel will fall from the current Rs 293 per liter to Rs 278.66 per liter.
Meanwhile, oil trading firms are forecasting a fall in petrol prices of 3.51 rupees per liter.
As CNG outlets in Punjab rely on imported gas, petrol is a viable alternative, especially in winter when LNG is unavailable.
The government is currently developing an Rs. 120 billion cross-subsidy scheme for petrol consumption. It is planned to impose a higher price of Rs 50 per liter for luxury car owners and an equal price relief for motorcycle and small car owners.
The government has an opportunity to lower gasoline prices and give relief to low-income and lower-middle-class consumers.
If the full reduction is passed on to consumers, the cost of petrol will drop to Rs 268.49 per liter, down from the current rate of Rs 272 per liter.
Likewise, the price of kerosene could fall by 13.46 rupees per liter and light diesel fuel (LDO) by 10.28 rupees per liter. Kerosene oil is an essential household fuel for cooking and heating in remote areas and the reduction could bring the price down from Rs 190.29 per liter to Rs 176.83 per liter. LDO can also see a drop to Rs 174.40 per liter from Rs 184.68 per liter.
The price calculation is based on the procurement costs of Pakistan State Oil (PSO). The government can allow an exchange rate adjustment of Rs 6 per liter for petrol and Rs 15 per liter for HSD. In the last 13 days, the US dollar has appreciated by Rs 4.66 against the Pakistani rupee.
To meet a requirement from the International Monetary Fund (IMF), the government will increase the oil tax through HSD from Rs 5 to Rs 50 per liter from April 1st. The government has already levied an oil tax of 50 rupees per liter of petrol since November 2022.
Also Read: Petrol Price in Pakistan Increased To Rs272 As Of 16th February 2023