The government announced the third hike in the prices of petroleum products in less than three weeks, as it looks to quickly appease the International Monetary Fund (IMF) that emphasised the termination of energy subsidies to revive its bailout programme.
Addressing a press conference in Islamabad alongside State Minister For Petroleum Musaddaq Malik, Finance Minister Miftah Ismail announced that the price of petrol has been increased by Rs 24.03 per litre to Rs 233.89 per litre.
The price of diesel has been increased by Rs 59.16 per litre, after which the price of diesel has been increased to Rs 263.31 per litre while the price of kerosene has been increased by Rs 29.49 per litre to Rs 211.43 per litre.
The price of light diesel has also been increased by Rs 29.16 to Rs207.47. The new prices of petroleum products will be applicable from midnight on June 16.
The increase comes days after presenting Rs9.5-trillion budget for 2022-23 aimed at tight fiscal consolidation in a bid to convince the IMF to restart much-needed bailout payments.
Earlier on Saturday, Finance Minister Miftah Ismail said that the IMF has expressed concern about the country’s recently unveiled budget, but the government is confident it can make changes to satisfy the lender.
He said the IMF was concerned about fuel subsidies, a widening current account deficit, and the need to raise more direct taxes.
The government had raised fuel prices by Rs60 – Rs30 on two separate occasions – to fulfil a key condition hindering the resumption of the IMF programme.
The prices were hiked by Rs30 on May 26 and again on June 3 by the same amount. On June 3, the finance minister said that despite the massive increase in the price of petroleum products, the government was still bearing losses.
The IMF programme has been on hold since 2021. Since assuming office, the current government has been engaged with the global lender to resume the stalled $6 billion bailout programme.