POL prices likely to go up in the range of PKR 2.79-7.62/liter – Alfalah Securities Limited

Karachi: The government is likely to raise the prices of petroleum products in the range of PKR 2.79 to PKR 7.62 per litre on account of a rising trend observed in the Arabian Light crude prices which has reached to USD 135 per barrel during March 2012, touching its 2 years high.

According to Alfalah Securities Limited, the price of Petrol is likely to go up by PKR 7.62 per litre, HOBC by PKR 7.29 per litre, kerosene oil by PKR 3.64 per litre, Light Diesel Oil by PKR 2.79 per litre and Diesel by PKR 1 per litre, in case the government sticks to its commitment of giving PKR 2.82 per litre subsidy on Diesel till June 30, 2012.

An increase in petroleum prices would heat up inflation across the economy as POL products are widely used in the production of electricity and consumed as a fuel on day-to-day basis. Moreover, an increase in POL prices would result in reducing the popularity of the present government however, instead of avoiding such un-populist measures, the government is maintaining the Levy imposed on petroleum products at current levels. The government has been able to collect PKR 9 billion through Petroleum Levy during the 1HFY12.