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Another ‘petrol bomb’ in the offing for August

International oil price prompts govt to increase fuel price
Updated 31 Jul, 2022 12:50pm
<p>Commuters queue for fuel at a Pakistan State Oil station in Islamabad. AFP/File</p>

Commuters queue for fuel at a Pakistan State Oil station in Islamabad. AFP/File

ISLAMABAD: The government is expected to increase the petrol price by Rs10 from August 1 (tomorrow), with the increase in the oil prices in the international market, sources said. The new price would stand at Rs240.24.

Sources added that new price estimates were made without adding the petroleum levy, which would be Rs5. If the government goes ahead with it, the increase would come 15 days after it was reduced by Rs18.50 in the wake of falling oil prices. The government followed it up with slashing fares for economy passengers on the railway and the national flag carrier.

The price of diesel is also expected to increase, sources say, by Rs17. This doesn’t include the levy.

Oil prices settled up more than $2 a barrel on Friday as attention turned to next week’s OPEC+ meeting and dimming expectations that the producer group will imminently boost supply, Reuters reported.

Brent crude futures contract for September, which expire on Friday, jumped more than $3 a barrel during the session and then pared gains to settle at $110.01 a barrel, up $2.87, or 2.7%. The more active October contract was up $2.14, or 2.1%, at $103.97.

US West Texas Intermediate crude futures settled at $98.62 a barrel, rising $2.20, or 2.3%, after jumping more than $5 a barrel.

Petrol levy would increase according to the schedule, Finance Minister Miftah Ismail said while addressing a seminar in Islamabad on July 27. There was an Rs5 levy on diesel, Rs10 on petrol and no sales tax.

The federal cabinet this past week approved an Rs3.5 per unit increase in the power tariff while admitting that the next few months would be difficult for household consumers. It claimed that more than 80 million people, which amounts to 45 per cent of the population, would be exempted from such a decision. It described the decision as “rebasing”.

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