EconomyPakistan

Rs34 Drop Expected in Petrol Price from October 16

The interim government is considering a substantial reduction in petrol prices, which could decrease Rs34.57 per litre, bringing the price down to Rs288.38 from the current rate of Rs323.38. This potential price drop aligns with global oil price fluctuations and the recent appreciation of the Pakistani rupee against the US dollar.

The final decision rests with the interim government, which may resort to tax adjustments instead. The government currently charges a petroleum levy of Rs50 per litre on high-speed diesel (HSD), with room for a further increase of Rs10. However, the levy on petrol is already at the maximum level of Rs60 per litre.

Petrol is primarily used in motorbikes and cars and serves as an alternative to compressed natural gas (CNG), especially in Punjab, where locally produced gas is not available at CNG filling stations. In recent years, liquefied natural gas (LNG) has been used in CNG retail outlets, but supplies have become scarce as Pakistan Petroleum Limited (PLL) has struggled to secure import contracts.

The private sector has been attempting to import LNG since 2015, but these efforts have been unsuccessful due to the public gas utilities' desire to maintain their monopoly over gas supplies. This has led to a reliance on petrol as a primary fuel source.

Like petrol, high-speed diesel (HSD) may also decrease by Rs15.91 to Rs302.18 per litre for the next fortnight. HSD is primarily used in the agriculture and transport sectors, and any price reduction may positively impact inflation.

The price of kerosene oil, which sees increased consumption in remote areas during winter, is expected to be reduced by Rs21.95 to Rs215.33 per litre compared to the current rate of Rs237.28. Kerosene oil is used for cooking in remote areas like northern parts of the country, where the Pakistan Army is a major consumer.

Light diesel oil, used in industrial units, is likely to fall by Rs18.29 to Rs194.16 per litre compared to the existing price of Rs212.45.

The potential reduction in petrol prices comes as global oil prices have significantly dropped, and the Pakistani rupee has strengthened against the US dollar. The average gains for the rupee are calculated at Rs7.50 for the past 13 days.

This news comes as a relief for Pakistani consumers who have been grappling with high fuel prices. However, it's important to note that these are potential changes, and the final decision rests with the government.

 

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