The new price of petrol is now PKR 272.89 per litre from the previous price of PKR 259.34, according to a notification from the Finance Division.
The price of high-speed diesel (HSD) was increased by PKR 2.75 to PKR 278.96 per litre.
The notification did not mention any changes in the prices of light-diesel oil (LDO) and kerosene oil.
The petrol price increase is higher than what was expected earlier. The prices of petrol and HSD were estimated to go up by PKR 5-9 per litre for the next fortnight owing to higher international prices and import premiums, nullifying the impact of minor exchange rate gains.
Dawn News reported quoting informed sources that the prices of both major petroleum products had increased in the international market over the past fortnight and Pakistan State Oil (PSO) also had to pay higher import premiums even though the rupee had gained against the US dollar.
As a result, the price of HSD was expected to go up by PKR 4-6 per litre and that of petrol by PKR 6.5 to 9 per litre, depending on the final exchange rate calculation. However, the prices of kerosene and LDO were expected to remain unchanged.
Officials had said the price of petrol had come down by more than USD 3 per barrel to USD 86.5 from USD 83 per barrel over the last two weeks while HSD had become costlier by about USD 2 per barrel to USD 97.5 from about USD 95.6.
The Pakistrupee on the other hand gained by about PKR 1.5 against the dollar to about PKR 280 from PKR 281 in the first half of January. The premium paid by PSO for securing product cargoes went up on both products by USD 2 per barrel each. It increased to USD 6.5 per barrel from USD 4.2 for HSD and from USD 7.5 per barrel to USD 9.5.
The government has already achieved a PKR 60 per litre petroleum levy–the maximum permissible limit under the law–on both petrol and HSD.
The government had set a budget target to collect PKR 869 billion as a petroleum levy on petroleum products during the current fiscal year under the commitments made with the International Monetary Fund but is hoping the collection to go beyond PKR 920 billion by the end of June, Dawn News reported.
Petroleum and electricity prices have been the key drivers of the high rate of CPI-based inflation recorded at 29.7 per cent in December 2023.