ISLAMABAD: The caretaker government has once again increased the price of petrol and diesel for the next fortnight.

The price of petrol has been hiked by Rs 26.02 per litre.  The new price of petrol is Rs 331.38 per litre, according to a notification by the Finance Division regarding the fortnightly review.

The price of High-Speed Diesel (HSD) has been hiked by Rs 17.34 per litre and has reached Rs 329.18. The new prices will be applied immediately upon notification.

It added that the decision was taken owing to the increasing trend of petroleum prices in the international market. No revision was specified in the rates of kerosene or light diesel oil.

The price increase comes after an already massive hike on September 1, when the interim government raised fuel prices by up to Rs18 per litre. The government also increased petrol prices on August 15, days after assuming power.

The price hike is based on existing tax rates and import parity prices, mainly because of currency fluctuation and a slight inc­rease in international oil prices.

It was earlier projected that petroleum prices would surge by up to Rs16 per litre amid the ongoing economic challenges, soaring inflation, rupee depreciation against the dollar, inflated utility bills, and escalating prices of essential commodities.

The rupee depreciated by Rs4.5 against the dollar in the first 10 days of current fortnight (from Rs299 to Rs304) before sliding below Rs300. The benchmark international Brent prices crossed $92 per barrel on Wednesday against $88 in the first week of September, nullifying any susbstantial gain in the the exchange rate.

The government would also pass on to consumers about 88 paise per litre impact of increase in sale margins for petroleum dealers and marketing companies already approved by the Economic Coordination Committee (ECC) of the cabinet last week.

The transport sector runs on HSD and its price is considered highly inflationary as it is mostly used in heavy transport vehicles and particularly adds to the prices of vegetables and other eatables.

Petro is mostly used in private transport, small vehicles, rickshaws and two-wheelers and has a direct bearing on the budget of middle- and lower-middle class.

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