Prime Minister Shehbaz Sharif has formed a 16-member committee to monitor the impact of the volatility in oil prices in the wake of Israel's attack on Iran, a major oil producing country.
A notification issued on Friday by the Ministry of Energy said there has been a sudden spike in oil prices in the international market after the start of the Israel-Iran conflict.
According to the notification, the committee — to be convened by the minister and finance — includes petroleum, power ministers, state minister for finance as well as the governor of the State Bank.
The committee will closely monitor the forward/futures prices of Petroleum Products and the predictability of supply chain in view of the current conflict in the region.
It will also determine forex implications of price volatility for the short and medium term and suggest a plan if required — to ensure that there are no supply disruptions and the market is well supplied.
It will also carry out a detailed analysis of the fiscal impact, in the event of a protracted conflict. The committee may co-opt any other member as deemed necessary for the fulfillment of its mandate.
"The Petroleum Division shall provide secretarial support to the committee. The committee shall submit its recommendations on a weekly basis for the perusal of the prime minister," it added.
Fuel prices
Consumers brace for yet another hike in fuel prices as estimates suggest that petrol and high-speed diesel (HSD) rates may increase in the upcoming fortnightly review, largely driven by a surge in international oil prices.
According to official sources familiar with the pricing structure, petrol is expected to see a marginal rise of around Re1 per litre, while the price of high-speed diesel could go up by approximately Rs5 per litre.
The changes would apply from June 16 to June 30, with the final decision to be made based on import cost calculations on June 15.
At present, the ex-depot price of petrol stands at Rs252.63 per litre. Widely used in motorcycles, rickshaws and private cars, any change in petrol price significantly impacts the expenses of the middle and lower-middle income groups.
Meanwhile, the ex-depot price of HSD is Rs254.64 per litre. Diesel fuels the bulk of Pakistan's heavy transport sector, including trucks, buses, tractors and farm machinery such as threshers and tube wells.
Given its broad use in agriculture and freight, an increase in diesel price typically triggers inflation across food supply chains.
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