ISLAMABAD:
Just a week after consumers received relief at the pump, the federal government has hiked oil prices sharply, raising petrol by Rs 13.18 per liter and high-speed diesel by Rs 13.80 per liter amid a renewed surge in international crude oil prices triggered by escalating tensions between Iran and the US.
The increase follows a new rise in global oil prices following renewed US attacks on Iran and a breach of ceasefire agreements on 7-8. July. Brent crude rose to around $77-$78 a barrel. barrel, while US West Texas Intermediate (WTI) traded at $73.60 a barrel. barrel, prompting the government to pass on the higher import costs to domestic consumers.
According to a notification issued by the Petroleum Division, the price of High Speed Diesel (HSD) has been increased by Rs 13.80. per litre, from Rs 309.50. to Rs.323.30.
Similarly, petrol price has been hiked by Rs 13.18 per litre, from Rs 297.53 to Rs 310.71 per litre.
The government has also increased oil duty on petrol from Rs70.36 to Rs80 per liter for retail outlets and from Rs79 to Rs88.64 for direct sales. The duty on premium HOBC/MS (95 RON) has been increased from Rs 95.36 to Rs 105 per liter for retail outlets and from Rs 97.51 to Rs 107.15 for direct sales.
The petroleum tax on kerosene remains unchanged at Rs20.36 per liter while light diesel oil (LDO) continues to attract a tax of Rs15.84 per litre. The duty on heating oil also remains unchanged at Rs77 per litre, equivalent to Rs82,077 per metric tonne.
The latest hike comes after the federal government on Friday cut the prices of petrol and high-speed diesel by up to Rs 1.97 per liter for a week.
High-speed diesel is widely consumed by the transport and agricultural sectors, and changes in its price have a significant impact on freight rates and inflation.
Gasoline is primarily used by motorcycles and passenger cars. Demand for petrol has also increased following restrictions on the use of indigenous gas in Punjab.
Petroleum oil remains an important fuel in remote areas, especially in the country’s northern regions, where liquefied petroleum gas (LPG) is not readily available for cooking. It is also a key fuel used by the Pakistan Army. Light diesel oil is mainly consumed by industry.
Meanwhile, Pakistan’s oil industry saw a significant drop of up to 20% in sales during June. Industry representatives attributed the decline mainly to the growing smuggling of petroleum products from Iran.
General sales tax (GST) on petroleum products remains zero, resulting in revenue loss for the provinces.
Sindh has now raised the issue of the federal government’s reliance on the petroleum tax, arguing that unlike the GST, which is shared with the provinces, the tax is retained solely by the federal government.
