ISLAMABAD: In the wake of an increase in the price of crude oil in the global oil market, the government is likely to jack up prices of petroleum products (POL) by up to Rs5 to Rs7 for the month of June 2018, it was learnt reliably.
Well-informed sources in petroleum division disclosed that from June petrol is likely to witness an increase of Rs7.46 per litre, high-speed diesel (HSD) Rs7.87 per litre, kerosene oil by Rs5.61 per litre and light diesel oil (LDO) by Rs5.25 per litre.
The incumbent government is likely to approve the hike in POL prices on its last day of the constitutional tenure, as there are fewer chances of relief from the current government, said sources.
Sources further said that the masses are likely to bear the additional burden of increased taxation on POL products from June. The added that this could lead to mass inflation in the country especially in the month of Ramzan, especially with the Eid just around the corner. The government has been collecting 27.5 per cent GST, said sources.
Moreover, official sources at Oil and Gas Regulatory Authority (OGRA) have confirmed that they have been working on future oil prices and have analysed data which has been shared with oil suppliers nationwide including Pakistan State Oil (PSO).
They said OGRA will forward its working paper on petroleum prices for the month of June to the petroleum division and ministry of finance for the further necessary process on May 30, 2018. Meanwhile, the government will take a decision regarding the prices for June on May 31, 2018, sources added.
Sources cautioned that an increase in oil prices will likely inflict additional burden on the masses with the festive season just around the corner.
Earlier on Monday, a decline was registered in crude prices in the global market as global oil producers and suppliers including Saudi Arabia and Russia said they may increase oil supply, following pressure from the US government. Meanwhile, Brent crude stood at $75.70 per barrel, down 74 cents, or 1 per cent, from their last close.
Similarly, US West Texas Intermediate (WTI) crude futures were at $66.78 a barrel, down $1.1, or 1.6 per cent. Brent and WTI have also fallen by 6 per cent and 8.3 per cent respectively from peaks touched earlier in May. In China, Shanghai crude oil tumbled by 3.8 per cent to 462.3 yuan ($72.34) per barrel.
Moreover, it is worth mentioning that the Organisation of the Petroleum Exporting Countries (OPEC), and Russia reportedly started withholding supplies in 2017 to tighten the market and allegedly prop up prices, which in 2016 went down to their lowest level in more than a decade at less than $30 per barrel. However, crude prices has been witnessing an upward trend since the last year in the international oil market.