ISLAMABAD: The prices of major petroleum products, including petrol and high-speed diesel (HSD), are expected to decrease by up to Rs9.20 per litre for the second half of August, driven by declining international prices.
According to informed sources, international prices for petrol and HSD have dropped by over $3 per barrel in the past two weeks. This reduction could result in a price decrease of Rs8.50-9.30 per litre for petrol and Rs8-9 per litre for HSD, depending on the final exchange rate and existing tax calculations.
The average international price of petrol has fallen to $84 per barrel, while HSD has decreased to approximately $91 per barrel. Despite the local currency’s slight depreciation against the US dollar during the fortnight, the import premiums for petrol and HSD have remained steady at about $9 and $5 per barrel, respectively.
Currently, the ex-depot price of petrol is Rs269.43 per litre, and HSD is Rs272.77 per litre. The government had previously reduced petrol and HSD prices by Rs6.17 and Rs10.86 per litre, respectively, on July 31, following significant increases earlier in July. Kerosene and light diesel oil prices are also projected to decrease by Rs10 and Rs5 per litre, respectively, in the upcoming review.
Petrol is widely used in private transportation, impacting the budget of the middle and lower-middle classes, while HSD is crucial for the transport sector and agricultural machinery, making its price a key factor in inflation. However, reductions in petroleum prices rarely translate into lower transport fares or reduced costs for essential commodities.
The government has set the maximum petroleum levy at Rs70 per litre in its finance bill, aiming to collect Rs1.28 trillion in the upcoming fiscal year, significantly higher than the previous year’s collection of Rs1.019 trillion. Currently, the government imposes about Rs78 per litre in taxes on petrol and HSD, with a Rs60 per litre petroleum development levy and Rs18 per litre custom duty, in addition to Rs17 per litre distribution and sale margins for oil companies and dealers.
Story by Khaleeq Kiani
