On February 1st, the caretaker government raised petrol prices by Rs13.55, reaching Rs272.89 per litre. It plans to increase high-speed diesel (HSD) prices by Rs8 per litre starting February 16th. A slight increase in petrol prices of 80 paisas per litre is also expected. These adjustments stem from global oil price fluctuations.
Economic Implications
HSD, vital for transport and agriculture, may see its price rise to Rs286.97 per litre. This depends on government decisions, premiums, and exchange rates. Such an increase could significantly impact inflation. Meanwhile, kerosene oil prices might stay at Rs186.62 per litre despite a small hike of 62 paisas. Light diesel oil (LDO), mainly used in industries, could go up by Rs2.50 per litre to Rs169.62. In remote areas and among the Pakistan Army in the north, kerosene is essential for cooking due to the lack of Liquefied Petroleum Gas.
The Pakistan State Oil (PSO) reported a premium decrease for petrol to $9.43 per barrel. HSD imports carry a $6.50 premium. Exchange rate adjustments are forecasted at 50 paisas for petrol and Rs1.70 for HSD. These price considerations incorporate current petroleum levy rates, general sales tax, and PSO’s supply costs. Following February 1st, Brent oil prices increased by about $1.5 per barrel to $83. This rise influences HSD’s pricing structure as the Oil and Gas Regulatory Authority finalizes fuel prices for the first half of February.
