ISLAMABAD: In a bid to provide relief to consumers amidst fluctuating international oil markets, Pakistan is expected to announce a reduction in petroleum prices for the third consecutive fortnight, effective September 1, 2024.
Sources indicate that the price of petrol is likely to decrease by Rs 3.10 per liter, bringing it down from Rs 260.96 to Rs 257.86 per liter. Similarly, high-speed diesel (HSD) is expected to see a reduction of Rs 2.50 per liter, from Rs 266.07 to Rs 263.57 per liter. These price adjustments come on the heels of declining global petroleum prices, which have shown a significant downward trend in recent weeks.
Breakdown of Proposed Price Changes
• Petrol: Expected to decrease by Rs 3.10 per liter, from Rs 260.96 to Rs 257.86.
• High-Speed Diesel (HSD): Likely to decrease by Rs 2.50 per liter, from Rs 266.07 to Rs 263.57.
• Kerosene Oil: Anticipated to decrease by Rs 1.39 per liter, from Rs 171.77 to Rs 170.38.
• Light Diesel Oil (LDO): Expected to decrease by Rs 1.96 per liter, from Rs 157.02 to Rs 155.06.
The reductions in petroleum prices are directly attributed to a recent decline in international crude oil prices. Over the past two weeks, crude oil prices have fallen by approximately $2 to $2.30 per barrel, with the average price of petrol dropping from $82.50 to $80.40 per barrel, and HSD decreasing from $90.30 to $88 per barrel. The premium on petrol currently stands at $8.47 per liter, while the premium on HSD is $5 per liter.
These adjustments are part of the government’s ongoing strategy to align domestic fuel prices with global market trends, ensuring that any reductions in international prices are swiftly passed on to consumers.
Economic Relief Amid Rising Costs
If these proposed price cuts are approved, they will provide much-needed relief to both consumers and businesses who have been grappling with high fuel costs amid a broader economic slowdown. Lower petroleum prices could help reduce transportation costs and curb inflationary pressures, which have been impacting the cost of living and operating expenses for businesses.
However, the final decision on the price adjustments will be based on a comprehensive assessment of various economic factors, including the impact on government revenue. The authorities are currently finalizing the exact figures, taking into account the current petroleum levy and general sales tax rates.
Government’s Approach
The government remains committed to balancing the need for economic relief with fiscal responsibility. While these price cuts are likely to be welcomed by the public, officials are mindful of the potential impact on revenue collection. The reduction in fuel prices could affect the government’s tax income, but it is expected that the economic boost from lower costs could offset some of the immediate revenue losses.
As the government prepares to announce the new prices, the public and industry stakeholders are hopeful that these measures will bring some stability to the market and alleviate the financial burden on citizens across the country.
