ISLAMABAD – Keeping the Rs55 per litre petroleum development levy unchanged, the government on Saturday decreased the prices of petrol and high-speed diesel for the next fortnight.
The Pakistani government is supposed to increase the petroleum development levy to Rs60 per litre under the conditions set by the International Monetary Fund (IMF). However, Finance Minister Ishaq Dar said while announcing the new petrol prices that Prime Minister Shehbaz Sharif had directed him not to increase the petroleum development levy this time.
On Saturday, the price of petrol was cut by Rs9 per litre to Rs253 from Rs262 in the previous fortnight. Similarly, the price of high-speed diesel (HSD) was decreased by Rs7 to Rs253.50 per litre from Rs260.50 in the last fortnight.
Dar said the international oil market had seen fluctuations during the outgoing fortnight between July1 and 15. “There was an increase in one product and decline in the other,” Dar said, adding, “But the strengthening of the rupee against the dollar had offset the price increase.”
As per the agreement with the IMF, the finance minister said, the first phase of the petroleum development levy was implemented on July 1. However, he said, the second phase was scheduled to be added to the fuel price in the second fortnight of July, but it was not implemented. “So now the PDL [petroleum development levy] is not passed on to the consumers,” he said.
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According to experts, the cut in the prices of key petroleum products will benefit the local oil industry and curb smuggling of petrol and diesel from Iran to some extent.
Smuggling of diesel from Iran has significantly increased over the last six months due to high rates of high-speed diesel (HSD) in Pakistan. The HSD price had reached Rs293 per litre in mid-April this year and the petrol price touched Rs282 per litre at that time.
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The average petrol consumption in Pakistan during these days was more than 20,000 tonnes per day. HSD consumption in Pakistan in the last fortnight was around 18,000 tonnes per day. According to estimates, 8,000 to 10,000 tonnes of HSD was being smuggled into Pakistan from Iran on a daily basis. However, Iranian petrol is not very much in demand in Pakistan due to its low quality.