The government has slightly increased the price of petrol by Re1 per litre and high-speed diesel (HSD) by Rs7 per litre for the next fortnight, according to a press release issued by the Finance Division on Friday.
The revision follows an assessment by the Oil and Gas Regulatory Authority (Ogra) in response to fluctuations in the international oil market. With the new adjustment, the price of petrol now stands at Rs257.13 per litre, while HSD is priced at Rs267.95 per litre.
No changes were mentioned for light diesel oil and kerosene oil.
Market Trends and Price Determinants
Industry insiders had earlier predicted a Rs2-3 per litre increase in petrol prices and an estimated Rs6 per litre rise in kerosene and diesel, citing a bullish trend in global oil prices.
Brent crude prices saw an increase of $2 per barrel over the past fortnight, while the average price of HSD surged by more than $2.50 per barrel in the international market. Petrol prices edged up by approximately 50 cents per barrel. The import premium on petrol rose by 40 cents to $8.84 per barrel, while the premium on diesel remained unchanged. The exchange rate also remained stable.
Impact on Consumers and Economy
Petrol is widely used by private vehicles, motorcycles, and rickshaws, directly affecting the budget of the middle and lower-income classes. Meanwhile, HSD plays a crucial role in heavy transport, agricultural machinery, and industrial operations, making its price a significant driver of inflation.
The government continues to levy heavy taxes on petroleum products. Currently, it imposes Rs60 per litre as Petroleum Development Levy (PDL) on both petrol and HSD. Additionally, a Rs16 per litre customs duty is charged, along with Rs17 per litre in distribution and sales margins for oil companies and dealers.
These adjustments are expected to influence transport costs and the overall price of essential commodities in the coming weeks.
