By Staff Reporter
ISLAMABAD: The government is poised to lower prices for all petroleum products by as much as Rs6.30 per liter starting Sunday, reflecting modest declines in international markets, according to industry officials.
The reductions, effective for the fortnight through Dec. 15, come amid slight variations in global crude and refined product costs. Based on current tax rates, the ex-depot price of high-speed diesel is projected to fall by about Rs3.70 per liter, or 1.4%, while petrol could drop by roughly Rs4.3 per liter, or 1.5%, depending on final calculations.
That’s a shift from the upward trajectory seen since June 1, when petrol prices have climbed by about Rs12.50 per liter and high-speed diesel by Rs29 per liter. The ex-depot petrol price, currently at Rs265.45 per liter, may ease to Rs261.75. High-speed diesel, now at Rs284.44 per liter, could slip to Rs280.
Petrol primarily fuels private transport, small vehicles, rickshaws and two-wheelers, directly affecting budgets for middle- and lower-middle-class households. High-speed diesel powers much of the transport sector, including heavy vehicles, trains and agricultural equipment like trucks, buses, tractors, tube wells and threshers. Its price is viewed as inflationary, often driving up costs for vegetables and other food staples. Transporters raised fares by about Rs27 per liter between May and August and haven’t rolled them back, even after a Rs9 per liter cut in diesel.
Kerosene and light diesel oil are also slated for cuts, with kerosene down by Re1 per liter, or 0.3%, from Rs194.34, and light diesel oil by Rs6.35 per liter, or 3.7%, from Rs170.80.
The government continues to impose hefty levies, charging about Rs100 per liter on petrol and Rs96 on diesel. While general sales tax remains zero on all petroleum products, authorities collect Rs78 per liter on diesel and Rs82 on petrol and high-octane blending components via the petroleum development levy and climate support levy, including Rs2.50 per liter for the latter. Customs duties add Rs16-17 per liter on both petrol and high-speed diesel, whether locally produced or imported. Oil companies and dealers pocket about Rs17 per liter in distribution and sales margins.
Petrol and high-speed diesel are key revenue drivers, with monthly sales averaging 700,000-800,000 tons, dwarfing kerosene’s 10,000 tons. In fiscal 2025, the government raked in about Rs1.161 trillion from the petroleum levy alone, with projections for a 27% surge to Rs1.470 trillion this year.
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