Inside Financial Markets
Govt increases petrol price by Rs10.49 per litre - Inside Financial Markets

Govt increases petrol price by Rs10.49 per litre

– Business Recorder

Rate goes up to Rs137.79 for petrol, while high speed diesel, which was increased by Rs12.44 per litre, will now be available at Rs134.48

The government increased on Saturday the price of petrol by Rs10.49 per litre, an over 8% increase that took the rate to Rs137.79 per litre.

The Finance Division, in its notification on Saturday, looked to justify the increase by saying that oil prices in the international market have risen to around $85 a barrel, which were the highest since October 2018, and the entire energy chain has seen a surge.

“Entire energy chain prices have witnessed a strong surge in the past couple of months due to higher demand for energy inputs and supply bottlenecks,” stated the notification.

“In the current scenario, the government has absorbed the pressure and provided maximum relief to consumers by keeping the petroleum levy and sales tax to a minimum,” the notification added.

“Therefore, prices worked out by Ogra (Oil & Gas Regulatory Authority) have been approved.”

The price of high speed diesel (HSD) has also been raised by Rs12.44 per litre and will now be available at Rs134.48. Moreover, the prices of kerosene and light diesel oil (LDO) have been increased by Rs10.95 and Rs8.84 per litre, respectively. The new price of kerosene is Rs110.26 per litre while LDO will be sold at Rs108.35 per litre.

Earlier, Ogra had sent a summary to the Petroleum Division for recommendations for a significant hike in the prices based on the current rate of petroleum levy (PL) and general sale tax (GST).

Ogra recommended a Rs8-per-litre raise in rate of petroleum and another increase by Rs11 per litre in price of HSD.

Petrol prices have risen significantly in the past few months, with the government maintaining they are the lowest among the peers of oil-importing countries. However, many believe the hike will now stoke further inflation in the coming months with the CPI reading already hitting 9% in September.

‘Prices still lower compared to international petroleum prices’

Defending the price hike, Minister of State for Information Farrukh Habib said global inflation has been caused by the coronavirus pandemic, adding that prices are still lower as compared to the international petroleum prices.

He further said that in the last 15 days, petroleum prices rose by 13.5% globally but the PTI government has increased the rates by only 8%, adding that they chose to take a hit of billions on revenue but ensured that the burden passed on the public of this hike “was as low as possible”.

‘No words to describe extreme cruelty of selected PTI’

Meanwhile, Pakistan Muslim League-Nawaz President and Leader of the Opposition Shehbaz Sharif termed the hike in petrol price as “utterly shameful”, saying that it will push people to the brink of starvation.

The PML-N president said that there were no words to describe the extreme cruelty of the PTI government which it has inflicted on the people.

Pakistan Peoples Party (PPP) Chairperson Bilawal Bhutto also reacted to the petrol prices, saying that “PTI has brought a tsunami of inflation in the country”.

“By increasing the price of petrol by more than Rs 10 per litre, the government is actually collecting the price of its incompetence from the people,” he said.

Syed Zaki Hussain

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