Petrol and diesel prices in Pakistan are at an all-time high. here’s why

1. Petrol and diesel prices in Pakistan have risen by 35 rupees, while kerosene and light diesel prices have risen by 18 rupees, Pakistani Finance Minister Ishaq Dar announced in a televised speech, 10 minutes before the entry into force of the price increase.

2. “Government has announced new prices for petroleum products effective 11:00 am, 29th January 2023. High Speed ​​Diesel – Rs 262.80 per liter MS Petrol – Rs 249.80 per liter Kerosene – Rs 189.83 per liter of light diesel oil – 187 rupees per liter,” Pakistan’s finance ministry tweeted.

3. Finance Minister Ishaq Dar said that despite international prices and the devaluation of the rupee, “on the instructions of Prime Minister Shehbaz Sharif, we have decided to increase the minimum price of these four products”, reported the Dawn newspaper.

4. Ishaq Dar added that over the past four months, the price of gasoline has not increased. “In fact, diesel and kerosene prices have come down,” he said, as quoted by Dawn.

5. Explaining the reason for the increase, Mr Dar said it was done based on the recommendation of the oil and gas regulator. “They said there were reports of artificial shortages and hoarding of fuel in anticipation of the price hike – therefore this price hike is being done immediately to combat this.”

6. The value of the Pakistani rupee has fallen 34 rupees against the US dollar since Thursday, the largest depreciation in absolute and percentage terms since the introduction of the new exchange rate system in 1999.

7. The Pakistani rupee also depreciated sharply after the government removed an unofficial cap on the USD-PKR exchange rate to revive the stalled International Monetary Fund (IMF) lending program.

8. The cash-strapped nation is due to complete the ninth review of a $7 billion IMF program that would not only disburse $1.2 billion but also unlock inflows from friendly countries and other multilateral lenders. .

9. Prime Minister Shehbaz Sharif has said his coalition government is determined to complete the bailout even if it will face a political cost for the decision months before national elections, Bloomberg reported.

10. Measures to meet IMF conditions include raising fuel and energy prices and raising taxes, which, combined with the currency’s fall of around 13% over the past two days, could further fuel inflation.

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