Petroleum prices likely to go up in July

ISLAMABAD: Petroleum products are likely to become expensive with effect from July 1 not only due to   higher prices in international market but also due to the possible increase in taxes as the government is aiming at boosting revenue collection.

In view of this the government is now likely to raise the prices of high-speed diesel (HSD) and petrol by Rs9.84 per liter and Rs7.54 per liter, respectively, for the next fortnight starting from July 1.

This possible increase in petroleum prices in July is attributed to fluctuations in global oil prices. The government also plans to increase the rate of petroleum levy on these two products.

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If the government increases the rate of petroleum levy by Rs5, the price of petrol may go up by Rs12.54 and HSD by Rs14.84 per liter.

The government is currently charging Rs60 per liter petroleum levy on petrol and diesel. HSD is widely used in transport and agriculture sectors.

Therefore, an increase in its price will have inflationary effects on consumers. Consumers have been enjoying relief due to cuts in the prices of petroleum products.

According to oil marketing companies’ estimates, the ex-depot price of petrol is likely to go up from Rs258.16 to Rs265.70 per liter, and HSD’s price would go up from Rs267.89 to Rs277.73 per liter. These calculations are based on current government taxes and margins.