Business

Price of petrol, diesel may increase by Rs32 per litre from Feb 16

Published

2 years ago

Farwa

US dollar exchange rate stands at 271.82 for next fortnight.
Mogas price would likely go up by 12.8% per litre.
Price of diesel could rise by 12.5%.

ISLAMABAD: In yet another hike, the prices of petroleum products may increase by over Rs32/litre from February 16 (tomorrow) owing to the US dollar exchange rate, The News reported.

Petroleum, oil and lubricants prices closed at Rs236.40 per dollar which currently stands at 271.82 for the next fortnight. However, the free-on-board Platt prices saw a decline as compared to last fortnight’s pricing.

As per the official and industrial sources, the Mogas price would likely go up by 12.8% per litre or by Rs32.07 to stand at Rs281.87 from Rs249.8 per litre.

Similarly, the price of diesel could rise by 12.5% or by Rs32.84 to stand at Rs295.64 from Rs262.8 per litre previously.

Kerosene oil price was forecast to increase 14.8% or by Rs28.05 to stand at Rs217.88 per litre, while light diesel oil (LDO) could go up 5.3% or by Rs9.90 to stand at Rs196.90 from Rs187 per litre set in the last review.

The above prices have been assumed based on the current government taxes and estimated Pakistan State Oil (PSO) incidentals. The government might adjust the exchange rate at over Rs251 with an increase of Rs15 per litre for both products of Mogas and diesel. The petroleum levy for diesel which stands at Rs40 could increase by Rs10 to Rs50 from February 16.

The government had earmarked the target to get a revenue of Rs850 billion by imposing a petroleum levy on petroleum, oil and lubricants, but the shortfall in this head has been estimated at Rs250 billion, and the authorities have pinned hopes on getting a revenue of Rs600 billion.

The government had carried out a massive increase of Rs35 per litre from February 1, 2023, till February 15.

Currently, the government is charging Rs50 per litre petroleum levy, whereas the general sales tax (GST) has not been imposed yet.

The official said that the exchange rate losses to the refineries and oil marketing companies (OMCs) would be done away with in a staggered manner later on as the government right now does not want to pass the full exchange rate on to the consumers.

The last increase in prices of petroleum products was made in the review on January 29, 2021, by the federal government.

Pakistan is currently facing a short supply of petrol, with its most populous province, Punjab bearing the brunt of the crisis, which was being blamed on petroleum dealers.

It has also been alleged that hoarders were holding onto petrol stocks in anticipation of a price hike scheduled on February 15 (today).

Business

Gold prices in Pakistan approach an all-time high.

Published

21 hours ago

Farwa

Following a substantial surge the prior day, gold prices in Pakistan are ascending to unprecedented levels with an additional gain on Thursday, coinciding with a rise in global precious metal rates.

The price of 24-karat gold in the local market rose by Rs700 per tola, reaching Rs277,900, as reported by the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA).

Likewise, the cost of 10 grams of 24-karat gold increased by Rs600, currently priced at Rs238,254.

Globally, gold prices exhibited an upward trend, increasing by $7 throughout the day. The APGJSA reports that the international gold price was $2,682 per ounce.

Notwithstanding the increase in gold prices, the silver market exhibited stability, with the price of silver maintained at Rs3,050 per tola.

In the previous month, gold prices in Pakistan reached an unprecedented high of Rs 277,000 a tola, driven by substantial gains in the worldwide market.

Business

World Bank: Power industry subsidies soar by 400% in just five years.

Published

21 hours ago

Farwa

Ninety-four percent of domestic customers will benefit from the budgetary subsidy in 2024, according to a World Bank report, which credits the increase in protected consumers with contributing to the weight of subsidies.

In the current fiscal year, the electricity sector subsidy has increased by an astounding Rs. 954 billion, from Rs. 236 billion in the 2020 fiscal year to Rs. 1190 billion.

Notwithstanding changes, the circular debt has averaged Rs. 400 billion yearly over the last four years due to the incapacity to minimize losses and inadequate recovery of electricity payments.

According to the World Bank, the government must solve the fundamental problems in the power industry in order to lower the burden of subsidies and circular debt, as rising electricity prices and inadequate tax collection will only serve to worsen the circular debt crisis.

The rise in Pakistan’s power sector circular debt has raised worries from the World Bank (WB) despite an unprecedented increase in energy pricing.

Within the last six years, the debt has grown by 1241 billion rupees, according to the World Bank’s study. Between 2019 and 2021, the debt climbed by 1128 billion rupees.

The electricity sector’s circular debt has been increasing at an alarming rate, according to a World Bank analysis. Between 2022 and 2024, there was a substantial increase of 113 billion rupees.

Pakistan’s electricity industry has 2393 billion rupees in total circular debt as of 2024.

Restructuring is required to solve the circular debt issue, according to the World Bank.

Business

Final settlement: Govt to pay five IPPs Rs 72 billion.

Published

21 hours ago

Farwa

On October 10, Prime Minister (PM) Shehbaz Sharif declared that the agreements with five IPPS would be terminated in the first phase. Sources claim that the government will give Rs 15.5 billion to Rousch Power and Rs 36.5 billion to Hubco.

In a same vein, the federal government would pay Lalpir Power Rs 12.8 billion, Atlas Power Rs 15.5 billion, and Sapphire Power Rs 6 billion.

The sources state that late payment fees are not included in the settlement. With effect from October 1, the agreements with the five IPPs will be considered officially ended.

PM Shehbaz earlier remarked that the termination was carried out with the owners of the IPPs’ mutual permission while presiding over the federal cabinet meeting in Islamabad.

The Prime Minister notified the Cabinet that the only money that will be paid, interest-free, to these IPPs is the outstanding balance.

According to him, the national exchequer will gain over 411 billion rupees from the termination of these contracts, while power customers will save roughly sixty billion rupees.

According to Prime Minister Shehbaz Sharif, it was the result of the arduous teamwork of the entire government. In this regard, he also acknowledged the contributions and assistance of the associated parties. He specifically mentioned General Asim Munir, the Chief of Army Staff, who showed a personal interest in the situation.

The prime minister characterized the development as the start of a trip that will ultimately lead to the advancement and prosperity of the populace.

PM Shehbaz Sharif also brought up the assistance that the Punjabi and Federal governments gave to power users over the summer.