ISLAMABAD: The federal government has announced a reduction of Rs1.97 per litre in the prices of petrol and high-speed diesel, effective July 4, according to an official notification. The move comes as the government balances a rise in carbon tax with a cut in the petroleum levy.
The new price of petrol stands at Rs297.53 per litre, down from the previous rate, while high-speed diesel is now priced at Rs309.50 per litre. The notification states that the revised prices will take effect immediately.
Earlier, the government increased the carbon tax on petrol and diesel from Rs2.5 to Rs5 per litre. To offset this increase, the petroleum levy was reduced, ensuring that the net impact on consumers is a price cut. The carbon tax has also been imposed on high-octane blending components and furnace oil at the same rate. Experts note that the full impact of the carbon tax hike may be reflected in the next price announcement.
In a related development, the government has established a Petroleum Prices Stabilisation Fund (PPSF) to mitigate price fluctuations in the energy sector. The Ministry of Finance issued a notification creating a new account for the fund, following approval by the federal cabinet on June 5. Proceeds from the fund will be credited to the Public Account of the Federation under the Special Deposit Fund head.
The operational framework for the PPSF will be jointly developed by the Finance Division, Petroleum Division, and the Oil and Gas Regulatory Authority (OGRA), in line with legal and financial requirements. The mechanism will require separate approvals. Notifications have been sent to the Auditor General, Controller General of Accounts, and provincial accountants general for implementation. The State Bank of Pakistan, the Presidency, the Prime Minister’s Office, and provincial governments have also been informed.
Analysts view the price reduction as a relief for consumers amid inflationary pressures, though the long-term impact of the carbon tax remains to be seen. The establishment of the PPSF is seen as a step toward stabilizing energy prices and shielding consumers from volatile global oil markets.
Source: ARY News