By Staff Reporter
ISLAMABAD: The government has cut the price of petrol by 5.3 percent to Rs273.10 per liter for the next 15 days, the second cut in a fortnight, providing some relief to consumers reeling from inflation over the past two years.
The move, effective from May 16, reduces the price of petrol from Rs288.49 per liter, while high-speed diesel prices have been lowered by 2.8 percent to Rs274.08 per liter from Rs281.96.
The price cut is the second in a fortnight, after a 1.9 percent reduction on May 1, and comes as Pakistan negotiates a new loan with the International Monetary Fund (IMF).
The country significantly increased fuel prices in recent months after securing a short-term, $3 billion loan from the IMF last year.
The price cuts are likely to mitigate the impact of soaring inflation, which has remained above 20% for several months. Fuel prices have a significant impact on the cost of living in Pakistan.
“The prices of petroleum products have seen a decreasing trend in the international market during the last fortnight,” the Finance Division said in a statement.
“The Oil & Gas Regulatory Authority (OGRA) has worked out the consumer prices, based on the price variations in the international market. The prices of Motor Spirit & HSD for the next fortnight, starting from 16th May, 2024, are accordingly being lowered.”
The price adjustment also reflects a minor improvement in the rupee-to-dollar exchange rate, now at Rs 278.47152 per liter, down from Rs 278.63100. The current premium on petrol is set at $10.30 per barrel, with the HSD premium remaining unchanged at $6.50 per barrel over the last fortnight.
Petrol, primarily used in cars, motorcycles, and other vehicles, and HSD, used in heavy vehicles such as trucks, buses, industrial machinery, generators, and some agricultural equipment, are both essential fuels affecting the cost of living in Pakistan.
Kerosene Oil, utilized for cooking and lighting in households lacking electricity, and Light Diesel Oil, employed in industrial boilers, furnaces, and certain engines, are critical in sectors like textiles, cement, and power generation.
With a petroleum levy of Rs60 per liter on both petrol and HSD, the government anticipates collecting Rs936 billion in petroleum levy this fiscal year, surpassing the budgeted target of Rs869 billion. Petroleum products remain exempt from the general sales tax.
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