Why petrol is expensive in Pakistan?

Why Petrol Is So Expensive In Pakistan?

Over the last two weeks, Petrol is being discussed by every Pakistani. No matter what educational background, career and occupation they may have but petrol prices have made an impact on all of them. Why petrol is so expensive in Pakistan? We do not have the exact answer to it but we have interesting details about taxes and duties. Let’s discuss why petrol is so expensive in Pakistan.

Pakistan is not a crude oil-producing country, It has o import majority of crude oil from different countries. Though Oil fields are present in different areas of Pakistan the quantity of oil is way less to fulfil our needs. Since we have to import it, we need to buy it from Gulf countries. The crude oil is traded in dollars. Due to inflation, the dollar rate has increased much higher and the purchase price of crude oil is more expensive.

Why petrol is expensive in Pakistan?

Pakistan also tried the venture of buying cheap crude oil, refining it and using it. For this purpose, a deal was signed between Pakistan and Russia. The issue with Russian Crude Oil is its impurity and less content of petrol, diesel and kerosene oil. Though it has more content of furnace oil which can be used in making electricity.

Also, this venture is suspended due to not being a cost-effective solution. As per Pakistan refinery limited, refining Russian crude oil is a labour-intensive job with fewer results. Also, this crude oil is coming to Pakistan through different ports, adding to its delivery cost. The Russian crude oil deal seems to be halted for now and may be discontinued in the future.

How It Works In Pakistan?

Pakistan’s major oil purchases are Arabian Crude Oil which is much pure and has a high content of Petrol, Diesel and Kerosene. The price of crude oil depends upon international market rates. OGRA (Oil & Gas Regulatory Authority)has shared a document in which different duties and taxes are summed up. The details are as under:

Different taxes and duties in per litre petrol

The fuel price includes multiple taxes and duties. If they are revoked, we can have petrol at a much more reasonable price. Fuel prices are all-time high in Pakistan. Let’s see what changes OGRA has to do in the next price change (after 15 days)

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