Petrol prices unchanged; diesel and kerosene prices reduced

ISLAMABAD: The government has announced adjustments in fuel prices, keeping petrol rates unchanged while reducing the prices of other petroleum products.

High-speed diesel has been reduced by Rs3.05 per litre, and light diesel by Rs2.78 per litre. Additionally, the price of kerosene has been cut by Rs3.32 per litre.

The new prices will take effect starting midnight tonight (Sunday) for the next 15 days.

Meanwhile, the government is pushing ahead with plans for a major upgrade of local refineries, worth $5-6 billion.

Also read: Go electric: All Islamabad petrol pumps to get EV charging stations

Officials have asked the Petroleum Division to come up with a proposal in a week to get the projects rolling. This came out of a recent meeting of the Special Investment Facilitation Council (SIFC), chaired by Planning Minister Ahsan Iqbal.

To fund these upgrades, authorities have temporarily decided to bump up the inland freight equalisation margin (IFEM) by Rs2.5 per litre on petrol, diesel, kerosene, and light diesel oil. The extra money will go into special ESCROW accounts to be used by the refineries under a government-backed incentive plan.

But this setup will only last until the next budget.

Ogra, the oil regulator, has been asked to figure out the impact of this increase, and a detailed report will be presented to the Economic Coordination Committee (ECC) for approval.

Not everyone is on board, though. Parco, which controls 48 per cent of the market, isn’t thrilled about the temporary nature of this hike.

They’re pushing for a long-term fix to the sales tax issues. The sales tax exemption on petroleum products in the 2024-25 budget has already made it tough for refineries to sign agreements with Ogra, which are crucial for these upgrade projects to kick off.