To comply with an IMF requirement, the Ministry of Finance is likely to raise petroleum product prices in the upcoming fortnightly review; however, the true impact of the recent PKR devaluation will be apparent in the subsequent fortnight review, which is due on February 15.
The News reported on Saturday that the price of diesel would probably increase by Rs25 in the impending fortnightly review next week.
The price might grow further and the general sales tax (GST) inclusion, even at 10%, would be driving the price much higher if the government hiked the petroleum levy (PL) to Rs50 per litre on diesel, which appears likely to meet the IMF condition.
The increase in gasoline costs is anticipated to be between 20 and 21 rupees. In the upcoming fortnightly review of pricing, the government has been charging Rs50 per litre PL on gasoline, and adding even 10% GST will be extremely expensive for consumers.
It should be noted that the review due on January 31 (Tuesday) would not be significantly affected by the sharp decline in the value of the rupee relative to the US dollar over the past two days, as the average exchange rate would be Rs240, according to information gathered from the nation’s oil sector.
However, it was found that the fortnightly review that was expected on February 15 would show a sizable increase in domestic petroleum prices as a result of rupee depreciation.