Petrol Price & Diesel Price Increased in Pakistan
Fluctuations in the global crude petrol price and its effect in Pakistan is simple – people face petrol diesel price increase including kerosene and LDO. It was decided that petroleum products will be increased up to 38.6% according to a recent report. The Oil and Gas Regulatory Authority (OGRA) recommended the Federal government to increase prices of petroleum products.
On Friday, March 31st 2017, the government after considering the new petroleum tariff submission by OGRA revised the petrol diesel prices by Rupee 1 per litre. However, the price of light diesel and kerosene remain unchanged.
The Finance Minister while talking to the media in Dubai announced that petrol diesel price will remain high in April and government will bear a burden of subsidy on petroleum products.
The increase in petrol price will directly hit the people, especially farmers, who utilize diesel for their tractors. Its high prices will definitely make chaos and will increase inflation by affecting the costs of transportation.
Current Petrol Price & Diesel Price
The new Petrol price according to the government’s tariff shall be:
Petrol (Motor Oil/RON-87) = Rs 74 per liter
High-Speed Diesel = Rs 83 per liter
The following dip in oil prices globally has led the government to charge the oil consumers with heavy taxes. The consumers in Pakistan are bound to pay higher taxes i.e. 38 percent more on oil products as compared to the international market.
Ogra informed that consumers paid GST Rs29.57 per litre on HSD during the year 2015-16 and Rs 6 per litre on petrol price. Furthermore, a GST up to Rs15.22 per litre on petrol, Rs13.18 per litre on kerosene and Rs12.21 per litre on light diesel oil (LDO) was also paid by the consumers of oil products. It is recorded that these are the highest prices paid yet. During this year the rates on GST are as follows:
Petrol Price Rs10.71 per litre
Kerosene oil Rs2.83per litre
LDO Rs4.64per litre
Mostly industrial generators, heavy trucks, and agriculture sector are dependent on diesel fuel. The petrol price hike will ultimately make the transportation of goods and services expensive, further burdening the common man who prefers to ride a motorbike.
A developing economy like Pakistan suffers when petrol price and diesel price increase. The household consumption pattern disturbs and the cost of transportation becomes high, which results in the increase in inflation. Pakistan is the biggest importer of oil commodities which means its higher price will ultimately result in increased inflation.