ISLAMABAD: In a significant move aimed at balancing economic pressures with public relief, the Federal Government of Pakistan has announced a major reshuffle in petroleum prices. While prices for Light Diesel Oil (LDO) and jet fuel have seen a sharp spike, the government has allocated a massive subsidy to keep petrol and High-Speed Diesel (HSD) prices stable for the current week.
Surge in Light Diesel and Jet Fuel Rates
According to the notification issued by the Ministry of Energy, the price of light diesel oil has been hiked by Rs. 67.51 per litre, bringing the new rate to Rs. 302.52.
Additionally, a 13% increase has been implemented for Jet Fuel. The price has surged by Rs 45.73 per litre, setting the new price at Rs 388.01 per litre. Market experts warn that this hike will likely lead to a further increase in domestic and international airfares across the country.
Rs. 23 Billion Subsidy to Stabilize Prices
To shield the general public from the full impact of global price fluctuations, the government has decided not to increase the prices of petrol and high-speed diesel. Key highlights of the subsidy include the following:
- A total subsidy of Rs. 23 billion will be provided from March 14 to March 20.
- Petrol: A subsidy of Rs. 49.63 per litre has been granted.
- Diesel: A subsidy of Rs. 75.05 per litre has been allocated to maintain price stability.
| Product | Increase (Per Liter) | New Price (PKR) | Levy (Per Liter) |
|---|---|---|---|
| Light Diesel Oil | Rs. 67.51 | Rs. 302.52 | — |
| Kerosene Oil | Rs. 39.20 | Rs. 358.01 | — |
| Jet Fuel | Rs. 45.73 | Rs. 388.01 | — |
| Petrol | Unchanged (Subsidized) | Previous Rate | Rs. 105.37 |
| High Speed Diesel | Unchanged (Subsidized) | Previous Rate | Rs. 55.24 |
Analysis of Economic Impact
While the subsidy provides temporary relief for motorists and transporters, the Rs. 39.20 per liter increase in Kerosene Oil is expected to hit low-income households hardest, as it is primarily used for cooking and heating in rural areas. The Petroleum Levy remains high at Rs. 105.37 on Petrol and Rs. 55.24 on Diesel to ensure the government meets its revenue targets despite the current economic crunch.
