Petrol Prices May Rise by Over Rs100 Per Litre as Govt Assures IMF of No Subsidy

Islamabad: The government has assured the International Monetary Fund that it will align petroleum prices with global market rates, raising the likelihood of a sharp increase of over Rs100 per litre in the coming week.

According to sources in the Finance Ministry, the IMF has expressed concerns over continued subsidies on petroleum products. In response, the government has agreed to adjust fuel prices in line with international oil rates.

Last week, Prime Minister Shehbaz Sharif rejected a proposal to increase petrol prices by Rs95 per litre and also blocked a Rs203 per litre hike in diesel prices. To maintain existing prices, the government reportedly provided financial support to oil companies from the development budget.

Sources revealed that out of Rs100 billion allocated from the Public Sector Development Programme (PSDP), Rs56 billion has already been used to subsidize fuel prices. Further use of these funds could help reduce the expected price hike.

The final decision on petroleum prices will be made in consultation with provincial governments.

It is noteworthy that global oil prices remain high, hovering between $106 and $108 per barrel, contributing to the pressure for a price adjustment.