Govt decides to end fuel subsidies after sharp decline in global oil prices

This decision comes in light of the fall in prices of crude oil globally, which led to a reduction in the price of petrol and diesel in the country. In fact, recently, the price of both these products fell drastically to Rs299 per litre and Rs311 per litre respectively.

This happened due to a decrease in international crude oil prices, as a result of the agreement between the USA and Iran to resolve a dispute that was going on for more than three months.

The decision was made in the seventh meeting of the National Steering Committee on Fuel Subsidy, headed by the Deputy Prime Minister and Foreign Minister, Mr Ishaq Dar.

The committee reviewed the implementation of fuel subsidy to be given to motorcyclists, small farmers, public transport and goods transport in all provinces, Gilgit Baltistan, and Azad Jammu & Kashmir.

Seeing the steep fall in global fuel prices and keeping in mind the fact that the benefit has already been given to consumers, the committee decided to stop the fuel subsidy.

The participants in the meeting include SAPM Tariq Bajwa, federal secretaries of petroleum and information technology, the governor of State Bank of Pakistan and high-level officials from all provinces, Gilgit-Baltistan and Azad Jammu and Kashmir.

After the hike in prices of oil in the international market due to US-Iran clash, the government decided to increase petroleum products prices after first opting to bear the burden itself.

For instance, the prices of petrol reached Rs458 per liter in April this year. However, shortly thereafter, the prime minister declared immediate reduction of Rs80 per liter in petroleum levy in order to ease the burden on the people.

Along with declaring the relief, the prime minister also launched a fuel subsidy scheme in order to protect the people from soaring fuel prices due to conflict in the Gulf region.

Under this scheme, motorists will be offered a subsidy of Rs100 per liter, while goods carriers, public transport and freight vehicles have been offered relief for a month.

As part of this relief plan, small trucks have been offered Rs70,000 per month, large trucks Rs80,000 and public transport buses Rs100,000 per month.