Tuesday, January 30, 2024
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Petrol prices likely to inflate by over Rs7 per litre from Feb 1

International markets sharply react to attacks on ships which is why price of motor petrol skyrocketed

A worker holds a fuel nozzle to fills fuel in a car at petrol station in Karachi, on September 16, 2023. — Reuters
A worker holds a fuel nozzle to fills fuel in a car at petrol station in Karachi, on September 16, 2023. — Reuters

  • Prices of petrol likely to increase by Rs7.85 per litre.
  • High-speed diesel expected to go up by Rs2.06 per litre.
  • Increase in prices mainly because tension in Middle East. 


ISLAMABAD: The outgoing caretaker government is expected to increase the prices of petroleum products from February 1, 2024, for the first fortnight of the next month, The News reported Tuesday. 

The prices of petrol are likely to inflate by Rs7.85 per litre and high-speed diesel (HSD) by Rs2.06 per litre mainly because of the tension in the Middle East on account of the Israeli bombardment of Gaza and attacks on Yemen's Houthis. 

“International markets sharply react to attacks on ships which is why the price of motor gasoline (petrol) in the international market skyrocketed by $6 per barrel and diesel by $3.7 from January 16, 2024, as the international companies shave increased their premiums on motor spirit and high-speed diesel have substantially increased,” sources told The News.

This has led to the ex-refinery price of MS petrol to Rs269.94 from Rs187.74 per litre in Pakistan and similarly, the ex-refinery price has also gone up to Rs282.77 per litre from Rs201.79. 

The impact of the increase of MS in international prices comes out to a hike of Rs10.60 per litre in petrol price and Rs6.56 per litre in diesel (HSD) price.

However, with the exchange rate gains adjustment of Rs2.75 in MS and Rs4.50 in diesel per litre, the motor gasoline price is expected to rise by Rs7.85 per litre and HSD by Rs2.06. However, kerosene prices may go down.

At present, the government is charging Rs60 per litre on petrol as a petroleum development levy (PDL). Consumers are also paying Rs5.69 per litre on petrol as IFEM (Internal Fright Equalisation Margin), Rs7.87 per litre as OMCs margin, and Rs8.64 per litre as dealers’ margin.

Likewise, the government charges Rs60 per litre as PDL on HSD. Those who consume HSD in their vehicles also pay Rs4.24 per litre as IFEM, Rs7.87 per litre as OMCs margin, and Rs8.64 per litre as dealers’ margin.

In the past fortnight, the government reduced the price of petrol by Rs8 per litre to Rs259.3. However, the diesel rate was retained at Rs276.21 per litre.

Meanwhile, there was a reduction in kerosene oil and light diesel oil rates by Rs1.97 and Rs0.92 per litre in the fresh revision.