The government is set to reduce petrol and high-speed diesel prices in line with the recent decline in international prices. Petrol is expected to drop by Rs9 per litre and HSD by Rs5 per litre in the upcoming review on June 15. The international market saw a decrease of $3.75 and $2.7 per barrel for petrol and HSD, respectively, over the last two weeks.
Despite the decrease in prices, the government has already maximized the Petroleum Development Levy (PDL) at Rs60 per litre, contributing Rs720bn to the treasury. However, the budget target for PDL collection has been revised to Rs960bn due to commitments with the IMF. The current tax on petrol and HSD is around Rs80 per litre, including customs duty.
Fuel prices significantly impact inflation, especially for the middle and lower-middle class. The reduction in prices will provide some relief to consumers and contribute to stabilizing the economy.
Published in Dawn, June 14th, 2024