The government has announced increase in petrol prices by Rs 1.77 per litre and High Speed Diesel (HSD) by Rs2 per litre, for the next fortnight. Dar said at a news conference, here, that the prices of Light Diesel Oil (LDO) and kerosene would remain same from January 16-31. Finance Minister Ishaq Dar said that Oil and Gas Regulatory Authority (OGRA) had proposed Rs 14.31 increase in kerosene oil, Rs 10.11 increase in light diesel oil, Rs3.94 increase in high speed diesel oil and Rs 1.77 increase in petrol but the prime minister had directed to provide maximum relief to the general public.He said that the government would bear the burden of Rs2.75 billion as subsidy for this period on petroleum products. He said the prices of petrol and high speed diesel oil had to be increased due to 43 percent increase in the prices of crude oil and petroleum products in the international market.He cited that the government kept the prices of the petroleum products stable since April last year and the increase at the international level was absorbed by the government.The price change came two weeks after the government decided on December 31 to revise prices of petrol and HSD on fortnightly basis. It was also decided that the prices of LDO and kerosene oil would remain unchanged for entire January.Pakistan People’s Party’s Senator Saeed Ghani said that the increase would give rise to price-hike and inflation.He said that the PML-N government is thirsty of people’s blood and policies of Finance Minister Ishaq Dar were destroying the country’s economy. He said people were being crushed by increasing petroleum prices. He said the increase in petroleum products was due to failure of the PML-N government in increasing exports of Pakistani goods alongside its failure in reducing budget deficit.Ghani announced that PPP would lodge stiff protest against the increase in petroleum prices in Parliament. He demanded of the government to withdraw the increase in the petroleum prices forthwith.Oil companies opened 2017 with price hikes across fuel products, on sentiments that the Organization of the Petroleum Exporting Countries and non-OPEC states would push through with their planned output cut this year.The price movement marks the seventh consecutive week that gasoline prices were increased and the sixth successive week for diesel.The US had jacked up domestic production of crude oil, revolutionized from the process of fracking, in order to decrease its reliance on oil imports. The OPEC, alongwith the major non-OPEC oil producers such as Russia, refused to lessen their production in fears of losing their market share bringing the prices down. With the aforesaid new agreement in place, the prices will start to crawl up in the international market temporarily. Because the higher prices will induce the fracking industry within the US, which was sitting idly by due to the lessened demand, to start its oil production again and make profit, thereby increasing the oil supply in the market. In the current scenario, Pakistan needs a long-term approach, depending upon the low oil prices is a riskier option than to invest in domestic supply of energy, renewable and otherwise, to marginalize dependency on oil imports. The government needs to take steps to control increasing petroleum prices because it may increase inflation.
