Pakistan Petrol Prices Remain High At Next Bi-Weekly Review

Pakistan Petrol Prices Remain High At Next Bi-Weekly Review

Pakistan Petrol Prices Remain High At Next Bi-Weekly Review

Pakistanis are unlikely to receive relief in the form of reduced prices for oil products at the next two-week review, The News learned on Monday.

People in the oil industry and government sector said the forthcoming oil price revision is unlikely to bring consumer relief as international prices for crude oil and petroleum products leave the government no leeway to cut prices.

People said ex-refinery gasoline and diesel prices show a nominal reduction for the next two weeks; however, it has not been able to adjust to lower oil product prices as the government has yet to recoup exchange rate losses that it has been experiencing for some time.

In the last bi-monthly review, the government left petroleum product prices unchanged by not adjusting the exchange rate loss, which it believes should be adjusted at the next review.

With the need to make up for the foreign exchange loss and the call from the International Monetary Fund (IMF) to generate additional revenue by increasing the petroleum tax on diesel, the government was unable to lower the prices for petroleum products for end consumers.

The government is currently levying an oil tax of 50 rupees on petrol and 12 rupees on diesel, while under the IMF deal it needs to increase the diesel tax to generate additional revenue.

People have pointed out that the price of diesel could rise significantly if the government recoups the exchange rate loss and raises the oil tax on diesel to 50 rupees on IMF terms.

However, they added that the oil tax rate is likely to be adjusted for foreign exchange losses, which could increase the price of diesel and the retail price of gasoline during the next bi-monthly fuel price review.

Also Read: Miftah Ismail No Longer Promises Petrol Price Increases

They said the government held back the collection of the General Sales Tax (GST) to avoid a massive hike in the price of petroleum products; However, the IMF urged the country to seek its imposition.

People have been saying that GST may be imposed on gasoline because oil taxes are already at their highest.

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