Petrol and diesel prices likely to surge following global oil market rally

ISLAMABAD: Following a surge in oil prices across the international market, a hike in the prices of petroleum products is highly likely, ARY News reported, citing sources.

According to sources, the price of petrol is expected to increase by Rs13 per litre, while the price of high-speed diesel is projected to go up by Rs14 per litre.

Prime Minister Shehbaz Sharif is expected to give the final approval for the revised petroleum product prices, after which the Petroleum Division will formally announce the new rates tonight.

Earlier on July 4, the federal government had issued a notification announcing a Rs1.97 per litre reduction in the petrol price and high-speed diesel rate.

According to the notification, the petrol price has been reduced by Rs1.97 per litre, bringing the new price to Rs297.53 per litre.

The price of high-speed diesel has also been cut by Rs1.97 per litre, with the new rate set at Rs309.50 per litre.

The revised prices will come into effect immediately, as per the official notification.

Before this, the government had increased carbon tax on petrol and diesel by Rs five.

The rate of carbon tax on petrol and diesel will be applicable from today at 12 am.

As per the notification, the government has increased the carbon tax from Rs 2.5 to Rs 5. While the government has balanced the rise in the carbon tax by slashing the petroleum levy.

According to the notification, the carbon tax is also imposed on High Octane and Furnace oil by Rs 5. The real effect of the carbon tax increase will surface on the next announcement of petrol and diesel prices.

In other news, the federal government has established a Petroleum Prices Stabilisation Fund (PPSF) to help manage fluctuations in petroleum product prices.

The Ministry of Finance on Tuesday issued a notification creating a new head of account for the fund, following the federal cabinet’s approval on June 5.

According to the notification, all proceeds received under the Petroleum Prices Stabilisation Fund will be credited to the Public Account of the Federation under the major head “Special Deposit Fund.” A separate account head and object code have also been allocated for the fund.