The federal government late on Monday decreased the price of petrol by Rs. 1/liter while increasing the price of high-speed diesel (HSD) by Rs. 3.77/liter, with petrol now costing consumers Rs. 334.18/liter and diesel Rs. 386.83/liter.
While the government maintains it is passing on the full impact of global price fluctuations onto consumers, its consumer rate includes Rs. 110/liter in taxes and duties on petrol and Rs. 96/liter on diesel. The price of kerosene oil has also increased by Rs. 1.96/liter, with the new price standing at Rs. 303.10/liter.
According to a Petroleum Division notification, the new prices would apply for July 28 (Tuesday) under the daily price fixation mechanism introduced earlier this month.
Petroleum Minister Ali Pervaiz Malik announced the implementation of the daily price fixing mechanism following renewed hostilities between Iran and the U.S. and the supply disruptions caused by the same. Prior to the latest round of conflict, the government was announcing weekly revisions. Prior to the conflict breaking out on Feb. 28, the government was announcing prices every two weeks. He said the daily pricing was based on a seven-day weekly average of international market prices to align with international standards.
The latest mechanism has seen resistance from the All Pakistan Dealers Association, which has granted the government two weeks to resolve its concerns regarding profit margins. The organization has threatened a nationwide strike if its demands remain unfulfilled.
Primarily used in private transport, changes to the price of petrol mainly affect the middle and lower-middle classes who use it for their daily commute. Hike to the prices of diesel, meanwhile, are perceived as inflationary, as it is used in the heavy transport sector and can drive up the rates of essential commodities.