ISLAMABAD: Higher international prices and import premiums are expected to offset a little increase in the exchange rate, causing the price of gasoline and high-speed diesel (HSD) to increase by Rs4–11 a liter over the course of the next two weeks, starting on February 16.
According to knowledgeable sources, Pakistan State Oil (PSO) was forced to pay higher import premiums on gasoline even though the rupee strengthened against the US dollar. The prices of each of the major petroleum products, gasoline and HSD, had climbed on the international market during the previous two weeks. As a result, based on the final exchange rate computation, the price of gasoline will increase by roughly Rs4 per litre and that of HSD by Rs9–11 per litre. Kerosene and light diesel oil prices are also anticipated to rise marginally.
According to officials, during the past two weeks, the price of gasoline has increased by around $1.20 per barrel to $89.9 from $88.7 per barrel, while the price of HSD has increased by roughly $3.5 per barrel to $101.82 from approximately $98.4. In contrast, the rupee appreciated by almost 40 paise versus the US dollar, reaching Rs279.7 from slightly over Rs280 in the first half of February. For gasoline, PSO’s premium for securing goods cargoes increased marginally from $9.5 to $9.7 per barrel. At $6.5 per barrel, it did not alter for HSD.
The maximum amount allowed by law, which is Rs60 per liter for both gasoline and HSD, has already been reached by the government. In accordance with agreements made with the International Monetary Fund (IMF), the government had set a budget aim to collect Rs869 billion in petroleum levies on petroleum products during the current fiscal year. Despite a steady increase in the per-litre charge, it has already earned almost Rs475 billion in the first half (July-December).
Although the reduced target has now been set at Rs920bn by end-June, the government is still anticipated to collect over Rs970bn by year’s end.
Gasoline is mostly utilized for personal transportation, compact cars, rickshaws, and two-wheelers, and its cost directly impacts the middle-class and lower-class budgets.
However, because HSD is largely used in heavy-duty vehicles, trains, and agricultural engines such as trucks, buses, tractors, tube wells, and threshers, its price is thought to be very inflationary. In particular, it raises the cost of vegetables and other food items.
Currently, the government taxes gasoline and HSD at a rate of roughly Rs82 per litre. The government charges Rs60 per litre PDL for both petroleum products, even though there is no general sales tax (GST) on any petroleum product. However, it charges Rs50 per gallon for 95RON petrol and high octane mixing ingredients. Additionally, the government levies a customs fee of roughly Rs. 17–20 per litre on gasoline and HSD.
With monthly sales of over 700,000–800,000 tonnes for petrol and HSD compared to just 10,000 tonnes for kerosene, these two products are the main revenue generators.
SOURCE: DAWN NEWS
