Pakistan Announces Petroleum Prices for First Half of March 2024

Pakistan Announces Petroleum Prices for First Half of March 2024

Karachi, February 29, 2024 – The Pakistan government is gearing up to unveil the petroleum prices for the first half of March 2024, with the new rates set to take effect from March 1, 2024, until March 15, 2024.

Speculations are rife that an increase in petroleum product prices is on the horizon, driven by a surge in the cost of these essential commodities.

Government sources indicate that a reassessment of petroleum product prices is slated for February 29, 2024, just ahead of the commencement of March. If these speculations materialize, consumers might experience a notable surge of Rs 3.50 per liter in petrol prices, with an additional Re 1 per liter for High-Speed Diesel (HSD).

The potential increase in HSD prices, commonly used in the transportation sector, carries inflationary implications. However, there is a contrasting forecast, suggesting a reduction of 80 paisa per litre for light diesel oil (LDO) and a 70-paisa hike in kerosene oil prices.

A significant factor contributing to the expected price adjustments is the import premium. The estimated import premium for petrol stands at 10.48, reflecting an increase from $9.43 per barrel. Simultaneously, the import premium for HSD is projected at $6.50 per barrel. Additionally, the government is proposing a Petroleum Levy of Rs 60 per litre on both HSD and petrol.

Reports reveal that the Oil and Gas Regulatory Authority (OGRA) is yet to finalize the recommended fuel prices for the first half of March. OGRA’s calculations will consider monthly tax targets, estimated fuel consumption, and the supply cost associated with the Pakistan State Oil (PSO).

Analyzing recent trends, January witnessed a decline in the sale of total petroleum products in Pakistan, amounting to 1.38 million tons. This represents a four percent year-on-year decrease compared to the same period in the previous year, primarily influenced by reduced petrol and diesel sales.

Despite a consistent downward trend in short-term inflation, reaching 30.68 percent year-on-year in the week ending February 22, 2024, according to official data, the anticipated increase in petroleum prices may pose challenges to stabilization efforts.

As the nation anxiously awaits the official announcement, consumers, businesses, and policymakers will closely monitor the implications of potential price adjustments on various sectors of the economy. Striking a delicate balance between economic stability and consumer affordability remains a critical consideration for the government as it navigates through these impending changes. The outcome of these decisions will undoubtedly shape the economic landscape for the first half of March 2024 and beyond.