Rs9.32 subsidy per litre on petrol, Rs23.05 on diesel still there

ISLAMABAD: With a steep increase in the prices of petrol and diesel by Rs60 per litre, Rs30 per litre hike on May 27 and then Rs30 per litre on June 3, 2022, the price of petrol has risen to Rs209.86 per litre and diesel Rs204.15 per litre.

However, after an increase of Rs60 per litre by the incumbent regime in the last seven days, the subsidy of Rs9.32 per litre on petrol and Rs23.05 per litre on diesel is still there, according to a top official at the Petroleum Division quoting the new build up prices of POL products. 

“This means the government will have to go for the third time for more increase in the price of petrol by Rs9.32 per litre and diesel by Rs23.05 litre to end the subsidy.”

The IMF has asked for 100 per cent withdrawal of subsidy on POL products. Once the subsidy is over, then the government will have to impose taxes and petroleum levy. The crude oil prices in international market may come down as there are reports that the OPEC oil cartel and allied producing countries, including Russia, will increase production by 648,000 barrels per day in July and August, offering modest relief for a global economy suffering from soaring energy prices.

If compared with the new prices of Mogas and diesel in Pakistan, with prices of the same products in India, the UAE, Bangladesh and UK, Bangladesh is the only country where the price of petrol and diesel is the cheapest. Price of petrol in Bangladesh in terms of Pak Rupee stands as of June 2, 2022 at Rs197.58 per litre, down by 5.85 per cent if compared to price in Pakistan of the same product that is now at Rs209.86 per litre.

Likewise, diesel price in Bangladesh stands at Rs177.6 per litre, down by 13 per cent as against the price in Pakistan that stands at Rs204.15 per litre. The price of MS in India stands at Rs246.64 per litre, up by Rs17.53 if compared with the price of petrol in Pakistan at Rs209.86 per litre. Similarly, the price of diesel in India is Rs228.52 per litre, up by 11.94 per cent as against the price of petrol in Pakistan that is now at Rs204.15 per litre.

In the UAE, the price of petrol in terms of Pak Rupee stands at Rs213.64 per litre up by 1.52 per cent as against the price of petrol in Pakistan at Rs209.86 per litre and diesel in the UAE stands at Rs222.73 per litre, which is again more by 9.10 per cent as in Pakistan diesel price is at Rs204.15 per litre. In the UK, the price of petrol is at Rs423.71 per litre, up by 101.9 per cent against the price of MS in Pakistan and likewise the price of diesel in the UK currently stands at Rs452.03 per litre, which is up by 121.42 per cent if compared with the latest price of diesel in Pakistan.