The Petroleum Division on Monday notified the latest increase in fuel prices amidst ongoing volatility in the global market, raising the price of petrol by Rs. 4.42/liter and that of high-speed diesel by Rs. 6.10/liter.
Applicable for Sept. 15, the revision under the daily price fixation mechanism brings the retail price of petrol to Rs. 380.24/liter and that of diesel to Rs. 409.42/liter.
According to Petroleum Minister Ali Pervaiz Malik, fuel prices are fixed on a daily basis due to fluctuations in international market prices amidst hostilities between Iran and the U.S. in a bid to boost transparency and pass on the full impact to consumers immediately.
The daily price fixation mechanism was implemented in July, replacing a weekly mechanism implemented in early March. Prior to the outbreak of the Middle East conflict, the government used to set prices fortnightly.
Both the All Pakistan Dealers Association and the Transport Goods Association have rejected the daily pricing mechanism, with the latter suspending a strike over assurances the price fixation mechanism would be revised. The Jamaat-e-Islami, meanwhile, has been protesting against high fuel prices since August, with the party demanding the abolition of the petroleum levy and the fixation of petrol at Rs. 225/liter. It has threatened a long march on Islamabad following deadlock in talks with the government.
On Sunday, Prime Minister Shehbaz Sharif announced a fuel subsidy for small vehicles. Under the scheme, motorcycles, rickshaws and other two and three-wheeled vehicles can avail Rs. 100/liter relief on up to 20 liters of petrol per month. Owners of cars up to 800cc engine capacity can avail Rs. 100/liter relief on up to 30 liters of petrol per month. Eligible citizens can register for the subsidy via SMS.
Primarily used in private transport, changes to the price of petrol tend to impact the middle and lower-middle classes, who use it for their daily commute. Changes in diesel prices, meanwhile, are considered inflationary, as increased hike the cost of heavy transport and can drive up the prices of essential commodities.