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Pakistanis have witnessed a sharp rise in petrol and diesel prices despite a decline in global crude oil prices. The contrast has raised fresh questions about the impact of the government's new daily petroleum pricing system and the taxes and levies included in fuel prices.
Since the introduction of the government's daily petroleum pricing mechanism, fuel prices in Pakistan have increased significantly.
Over the past 10 days, the price of high-speed diesel has risen by more than Rs65 per litre, while petrol has become Rs26.43 per litre more expensive.
The figures come even as international crude oil prices moved lower during the same period.
On July 17, the official price of high-speed diesel stood at Rs323.30 per litre. Under the new pricing formula, diesel has increased to Rs388.38 per litre, reflecting an increase of more than Rs65 per litre in just 10 days.
Petrol reaches record Rs335.81 per litre
Petrol prices have also continued their upward trend. The price of petrol increased from Rs310.71 per litre on July 17 to Rs335.81 per litre, marking a rise of Rs26.43 per litre.
Despite the continued increase, consumers received only Rs1.35 per litre in relief on petrol during the 10-day period.
Global prices move in opposite direction
While domestic fuel prices climbed, crude oil prices in the international market declined. Brent crude fell from $88 per barrel on July 17 to $83 per barrel, a decrease of approximately $5 per barrel.
Also Read: Petrol drops by Rs0.75; diesel rises by Rs2.24
Similarly, US West Texas Intermediate (WTI) crude dropped from $82.49 per barrel to $78.51 per barrel during the same period.
Although crude oil became cheaper, refined petroleum products recorded fluctuations in the international market.
Global petrol prices
The international price of petrol was:
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$101 per barrel on July 17
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$105 on July 20
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$108 on July 21
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$116 on July 22
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$118 on July 23
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$114 on July 24
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$110 on July 27
Global diesel prices
The international price of diesel stood at:
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$142 per barrel on July 17
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$143 on July 20
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$157 on July 21
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$162 on July 22
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$169 on July 23
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$150.58 on July 27
The data shows that refined fuel prices remained elevated despite the overall decline in crude oil prices.
Taxes, levies remain major component
The government continues to collect multiple taxes, duties and margins on petroleum products.
Charges on petrol
Each litre of petrol currently includes:
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Rs80 petroleum levy
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Rs5 climate support levy
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Rs15 customs duty
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Rs8.64 oil companies' profit margin
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Rs7.87 distribution margin
Charges on diesel
Each litre of diesel includes:
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Rs70.82 petroleum levy
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Rs5 climate support levy
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Rs15 customs duty
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Rs8.64 oil companies' profit margin
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Rs5 freight margin
These taxes, levies and margins continue to form a significant portion of the retail prices paid by consumers.
The latest pricing trend highlights a widening gap between falling international crude oil prices and rising domestic fuel prices in Pakistan.
While crude oil has become cheaper globally, consumers in Pakistan continue to pay record prices for petrol and diesel under the government's daily fuel pricing system, with taxes, levies and international refined fuel prices continuing to influence retail rates.
