Fuel Prices Expected to Drop Next Month

Jawad

28 Oct 2024

248

Fuel Prices Expected to Drop Next Month

Starting November 1, petrol and high-speed diesel (HSD) prices in Pakistan are expected to see a reduction of around Rs. 2 to Rs. 3 per liter. This expected decrease reflects slight drops in global oil prices over the past two weeks. The adjustment offers some relief to consumers following a recent price hike, and it aligns with the government's pricing approach, which closely monitors fluctuations in international oil markets.

Reports suggest that global prices of petrol and HSD dropped by $1.5 and $2.5 per barrel, respectively, over recent weeks. These international shifts, along with stable exchange rates and tax policies, indicate that petrol prices might decrease by approximately Rs. 3 per liter, while HSD prices could fall by about Rs. 2.30 per liter. Such reductions will take effect upon the government’s official announcement of the new pricing.

In global terms, the price per barrel of petrol has decreased to around $76, down from $77.5, while HSD now costs about $84 per barrel, down from $86.5. The additional import expenses associated with these fuels, along with the steady exchange rate, have kept local fuel distribution costs stable. This latest decrease is primarily driven by the dip in crude oil costs, which are passed on to consumers under current government policy.

Currently, the base price of petrol in Pakistan stands at Rs. 243.03 per liter, while HSD costs Rs. 251.29 per liter. This follows an October mid-month price increase where diesel prices were raised by Rs. 5 per liter. Petrol, on the other hand, was kept at Rs. 247.03 per liter for the remainder of the month, allowing for minimal adjustments in consumer costs.

In terms of taxation, the government collects around Rs. 76 per liter on both petrol and HSD. This tax revenue includes a Petroleum Development Levy of Rs. 60 per liter and an additional Rs. 16 per liter in customs duties. Oil companies and dealers receive around Rs. 17 per liter to cover costs associated with distribution and sales, helping to maintain a stable supply chain for fuel across the country.