By Staff Reporter
ISLAMABAD: Pakistan raised diesel prices by 9.6% and pushed up petrol rates, as the government abandoned weekly fuel price reviews in favor of daily adjustments to keep pace with volatile international markets following renewed conflict between Iran and the US.
The Petroleum Division said in a notification that the ex-depot price of high-speed diesel will rise by 31.05 rupees to 354.35 rupees a liter, effective Saturday, from 323.30 rupees previously. The ex-depot petrol price will increase by 5.44 rupees to 316.15 rupees a liter, from 310.71 rupees. Both prices will remain in effect through July 20.
Petroleum Minister Ali Pervaiz Malik said earlier Friday that the Prime Minister and federal cabinet had agreed to shift pricing authority to the Oil and Gas Regulatory Authority, which will now set rates daily based on international trends rather than the weekly schedule in place since early March. International diesel prices have climbed to around $140 a barrel from roughly $110 amid the regional escalation, Malik said. Ogra will publish not only the rates but also the underlying factors driving them at each pump, he added.
The shift marks an escalation in how Islamabad is managing fuel costs since fighting between Iran and the US broke out February 28, which sent oil markets into turmoil and prompted a string of price increases through the spring. Diesel, sourced largely for heavy transport, has been especially volatile, and Friday’s increase followed a weekly adjustment that had already added 13.80 rupees to the diesel price and 13.18 rupees to petrol.
The All Pakistan Dealers Association rejected the move to daily pricing and said it was weighing a protest for next week.
Diesel is a key input for Pakistan’s freight and agricultural sectors, powering trucks, buses, trains, tractors and tube wells, and increases in its price tend to flow directly into food and vegetable costs. Petrol, used mainly in private and small-vehicle transport, has an outsized impact on middle- and lower-middle-income households.
The government currently levies about 105 rupees per liter on both fuels through customs duties, in addition to a petroleum levy, a climate support levy and an inland freight equalization margin. Petrol and diesel together generate the bulk of fuel-related revenue in Pakistan, with combined monthly sales of 700,000 to 800,000 tonnes, dwarfing the roughly 10,000 tonnes of monthly kerosene demand.
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