Islamabad, December 27, 2024 – Petroleum prices in Pakistan have shown a significant decline throughout 2024, providing relief to consumers and contributing to a reduction in the inflation rate of essential items.
This development has been a key factor in stabilizing the country’s economy amidst global and domestic challenges.
According to the Pakistan Bureau of Statistics (PBS), the decline in petroleum prices has led to a 5.08% year-on-year (YoY) contraction in the Sensitive Price Indicator (SPI)-based inflation as of December 26, 2024. The SPI is a critical tool for monitoring the weekly price movement of 51 essential commodities across 50 markets in 17 cities of Pakistan.
The PBS data indicates that the price of high-speed diesel dropped by 7.49% during 2024, while petrol prices fell by 5.64%. These reductions in petroleum prices have positively impacted transportation costs and, by extension, the prices of various goods and services.
However, during the most recent week ending December 26, 2024, the SPI recorded an increase of 0.80%. Significant price hikes were observed in items such as chicken (22.47%), tomatoes (20.75%), sugar (2.19%), and vegetable ghee (up to 1.17%). Conversely, notable decreases were seen in onions (8.13%), potatoes (2.38%), pulse mash (1.28%), and bananas (0.68%).
The year 2024’s overall trends illustrate the dual impact of petroleum prices on inflation. The SPI data shows that 17 items (33.33%) experienced price increases, 10 items (19.61%) saw price decreases, and 24 items (47.06%) remained stable. The broader reduction in petroleum prices has mitigated inflationary pressures, especially for fuel-sensitive commodities.
Year-on-year statistics highlight a sharp decrease in the prices of key items such as wheat flour (36.20%), onions (31.21%), and electricity charges for Q1 (6.96%), alongside the reduction in diesel (7.49%) and petrol (5.64%). These declines underscore the critical role petroleum prices play in shaping economic conditions.
The drop in petroleum prices throughout 2024 has not only supported consumers but also enhanced the country’s economic resilience. Policymakers and market analysts continue to emphasize the importance of maintaining stable petroleum prices to sustain economic momentum and ensure affordability for the general population.
