The ruling alliance has reduced the rates of petrol by Rs9 and diesel by Rs7 in view of the change in rates and rupee appreciation against the dollar after Pakistan signed a deal with the International Monetary Fund. New rates will be applicable after midnight, Finance Minister Ishaq Dar said on Saturday.
“MS Petrol—with Rs 9 per litre reduction, new price Rs 253 per litre. High Speed Diesel —with Rs 7 per litre reduction, new price Rs 253.50 per litre,” Dar tweeted after he announced the new rates on PTV News.
The finance czar added that the government approved one section of the petroleum development levy as discussed with the international lender. “There would be no change in the petroleum development levy for next fortnight.”
Oil prices fell more than a dollar a barrel on Friday as the dollar strengthened and oil traders booked profits from a strong rally, with crude benchmarks recording their third-straight weekly gain, Reuters reported.
Brent crude futures settled at $79.87 per barrel, down $1.49, or 1.8%, while the US West Texas Intermediate crude futures fell $1.47, or 1.9%, to settle at $75.42 a barrel.
The Pakistani rupee had a major fall against the dollar when the IMF reached a staff-level agreement with Pakistan on a $3 billion Stand-By Arrangement. The rupee gained 10.55 on July 4.
On July 10, a global rating agency upgraded Pakistan’s long-term foreign currency issuer default rating (IDR) to ‘CCC’ from ‘CCC-’ because of improved external liquidity and funding conditions.
The rating agency, Fitch, noted that Pakistan took measures to address shortfalls in government revenue collection, energy subsidies and policies inconsistent with a market-determined exchange rate, including import financing restrictions. These issues held up the last three reviews of Pakistan’s previous IMF programme, before its expiry in June.