The federal government has hiked the dealers’ margin by Rs. 2.87 per liter on High-Speed Diesel (HSD) fuel. The increase has driven up the margin on HSD from Rs. 4.13 per to R. 7 per liter.
The new margin is now in effect. Although the government reduced the price of HSD fuel by Rs. 0.51 per liter, the overall price has increased due to a greater increment in the dealers’ margin.
A media report states that the government had previously increased dealers’ margin on petrol by Rs. 2.10 per liter. A day earlier, the federal government announced a hike of Rs. 6.72 per liter in the price of petrol.
Last night, the government announced an increase in fuel prices despite a decrease in oil prices in the international market.
The price of petrol was increased by Rs. 6.72 per liter, while the price of high-speed diesel (HSD) has been reduced by Rs. 0.51. The new price of petrol is Rs. 233.91 while the new price of diesel is Rs. 244.44.
Earlier today, finance minister Miftah Ismail issued an explanation for the price hike via a Tweet, stating that:
OGRA takes the average of Platt prices, adds freight and premium paid by PSO on top of these prices, and multiplies that by the exchange rate. In addition it also “trues up” the previous fortnight’s cost by taking into account the rupees paid by PSO at the actual exchange rate as opposed to the average used to estimate the previous fortnight’s cost. We have not added any new tax or levy to the price. The price of petrol has gone up (and diesel has gone down) because the cost paid by PSO in the previous fortnight was more than the cost estimated by OGRA and also because the premium paid by PSO on petrol increased and premium paid on diesel remained unchanged. Again, not one paisa of new taxes or levies was added.
Despite the explanation, the decision continues to face backlash from people as inflation continues to wreak havoc across Pakistan.