Gas prices in Pakistan rise 45%

Gas prices in Pakistan witnessed a new rise as part of several government measures to meet the cost of the country’s high energy bill and meet World Bank conditions, ahead of the expected consultation session on the 12th of this month .

The decision to raise the price of gas in Pakistan was intended by the relevant authorities in Islamabad to compensate for the lack of revenue, according to the local newspaper, The Express Tribune.

Meanwhile, companies and travel agencies are considering raising prices as rising fuel prices have cast a shadow over their revenues.

High fuel prices are pushing airlines and railways to study the rising cost of travel tickets to offset their fuel costs, according to what the Specialized Energy Platform has seen.

The movement to increase the price of gas and the tendency to increase the prices of air and land tickets by rail, comes after the increase in the prices of oil and electricity products in response to the conditions of the World Bank.

Rising gas price in Pakistan

Oil and Gas Regulatory Authority “Ugra” decided to increase gas prices in Pakistan by 45%, to compensate for the fiscal deficit for 2021, estimated at 264.8 billion Pakistani rupees, equivalent to 720.20 rupees / million British thermal units.

(Pakistani Rupee = US $ 0.0050)

Ugra and Soi Northern logos. Photo (Photo: Times of Islamabad)

After referring last year’s deficit rate to the federal government for advice, the commission allowed the Soi Northern Gas Pipeline to increase by 45% and the Soy Southern Gas to increase gas prices by 44%.

On the other hand, both companies demanded raising the ceiling of the planned increase of gas prices in Pakistan to 198% for Soi Northern Gas Pipeline, and 45% for Soy Southern Gas Company.

Ugra attributed her request to the federal government to agree to an increase in the price of gas in Pakistan that this step comes as an attempt to compensate for the lack of revenue for fiscal year 2022-2023.

(Fiscal year in Pakistan starts on July 1 of each year and ends on June 30).

The new gas prices will take effect from next fiscal year, provided that sales are currently carried out in accordance with prevailing prices.

Gas prices in Pakistan, after rising, allow Soi Southern Gas to collect approximately 285 billion Pakistani rupees from consumers, in addition to supporting the revenue needs of the Soi Northern Gas Pipeline by about 260.9 billion rupees.

Travel tickets and fuel prices

In recent months, Pakistan has waged a fierce war over fuel prices that sparked the overthrow of Imran Khan’s previous government, to find a new government led by Shahbaz Sharif himself in the face of scenarios with limited options to meet Monetary requirements. International. The fund in exchange for receiving the remainder of the loan installments up to $ 6 billion.

After the government raised fuel and electricity prices – a few days ago – airlines and railways are considering imposing travel ticket prices to offset their losses from rising fuel costs.

Rising oil prices have increased the cost of PRA’s daily losses to about Rs 20 million a day, prompting the company to seek a 15-20% increase in railway tariffs.

At the same time, airlines (government-affiliated and independent) are studying rising domestic and international travel prices, as the government-approved increase in oil prices at record rates in exchange for lower travel demand deepened losses. . of these companies, according to what sources have confirmed to the local newspaper, The Express Tribune.

With the adoption of new increases in fuel prices, the pressure on the spending budgets of these companies will increase, in addition to affecting the rate of international travel.

Petroleum products and electricity

The government decided on Thursday, May 26, to increase the prices of petroleum products, according to a decision announced by the Minister of Finance, Miftah Ismail, after long speculations and discussions that came on the scene recently. The decision did not address the imposition of any increase in the price of gas in Pakistan.

gas prices in Pakistan
Citizens at a Pakistani gas station – Photo (Daily Times)

After adding the projected increase of about 30 rupees per liter of diesel fuel, the price of gasoline becomes 209.86 rupees, the price of oil 204.15 and diesel 178.31.

The cost of government spending on oil is expected to increase to 25 billion rupees per year, from 20 billion rupees per year, following the implementation of the new pricing policy by Pakistan.

These prices also cast a shadow over electricity prices and the Pakistani government and its respective authorities decided to charge consumer bills for the current month an increase of Rs 7.86 billion.

This comes despite Finance Minister Miftah Ismail’s denial of imposing any increase in electricity and gasoline prices in Pakistan, according to a series of his posts in the middle of last month, which were reviewed by the Energy Specialist. Platform.

Ismail – later – accused the previous government of being responsible for putting Islamabad in debt, noting that Imran Khan’s government is behind 80% of Pakistan’s debts.

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