To comply with International Monetary Fund (IMF) recommendations, the Ministry of Petroleum has proposed to government raising gas prices by as much as 60%.
According to reports from the area’s media outlets, the new prices would be announced and implemented after receiving approval from the federal cabinet and after appropriate consultation with the provincial authorities. Based on the national weighted average price of gas, a new rate will be established. Everyone will pay the same rate, no matter where they call home.
The present price of gasoline in the United States is $8 per MMBtu, whereas the price of LNG from other countries is $13. The Petroleum Ministry plans to quickly execute its current proposal to increase gas prices for all consumers in order to eliminate the $5 price gap between these two categories. The sector’s revolving debt will be reduced as a result.
Government will increase prices
The use of liquefied natural gas in the production of fertilizers is anticipated to be a focus of the new strategy. The current situation, wherein LNG is provided to producers at reduced prices, has contributed to the ever-increasing revolving debt. After the new policy goes into effect, manufacturers will have to pay the going rate for LNG.
The Petroleum Ministry’s new strategy is expected to go into effect within the next few months. As a result, it will have far-reaching effects on shoppers everywhere. To no one’s surprise, the IMF has raised doubts about the federal government’s choice to delay reporting the hike in gas rate imposed by the Oil and Gas Regulatory Authority back in June.
The government has been forced to increase the gas tariff by more than 50% despite public demands for lower energy costs. The caretaker government is having a hard time keeping the economy afloat, and reducing the country’s revolving debt should be a top priority.
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