Pakistan’s interim government has implemented a steep price hike, pushing the cost of petrol and high-speed diesel (HSD) to unprecedented levels, crossing the 330 Pakistani Rupees (PKR) per litre mark.
This spike in price, announced on Friday night, follows recent price hikes of Pkr 32.41 and Pkr 38.49 per litre for petrol and HSD over the past two fortnights since August 15. According to Dawn newspaper, this translates to an astonishing rise of Pkr 58.43 and Pkr 55.83 per litre within just one month.
The decision to raise petroleum prices coincides with a 27.4 percent spike in the inflation rate for the month of August, the Pakistani newspaper said. This surge is expected to have a delayed impact on general prices throughout the country in the coming days and weeks. According to the report, both petrol and diesel have become 20 percent more expensive since the interim government assumed power.
pic.twitter.com/utyePZMGme— Ministry of Finance (@FinMinistryPak) September 15, 2023
Pakistan Finance Ministry announced the price hike after receiving approval from interim Prime Minister Anwaarul Haq Kakar. This decision was attributed to the escalating trend of global petroleum prices. As a result, the ex-depot price of HSD now stands at Pkr 329.18 per litre, a significant increase from the previous Pkr 311.84, marking a 5.6 percent rise or Pkr 17.34 per litre.
However, the actual retail price at fuel pumps is expected to exceed Pkr 330 per litre. Given that a substantial portion of the transportation sector relies on HSD, this increase is anticipated to fuel inflation, particularly impacting the prices of essential goods like vegetables.
Similarly, the ex-depot price of petrol has surged to Pkr 331.38 per litre from Pkr 305.36, indicating an 8.5 percent increase or Pkr 26.02 per litre for the next fortnight. Petrol primarily fuels private transport, small vehicles, rickshaws, and two-wheelers.
While there was no change in the prices of kerosene and light diesel oil, the caretaker government in the country is passing on the impact of an approximately 88 paise per litre increase in sales margins for petroleum dealers and marketing companies. This increase had already been approved by the country’s Economic Coordination Committee of the cabinet last week.