Petrol, Diesel Prices Might Decrease in Pakistan By May 1, 2024

• Global oil market fluctuations hint at a potential decrease in domestic gasoline prices in Pakistan.
• Analysts predict a downward trend in global petroleum product prices but caution against ongoing volatility.
• Pakistan’s petroleum pricing strategy is influenced by global oil prices and fuel consumption.

As Pakistan grapples with rising inflation, there may be a glimmer of hope on the horizon. Recent fluctuations in the global oil market suggest a possible decrease in domestic gasoline prices, offering relief to citizens.

International markets have witnessed a notable reduction in diesel and gasoline prices, dropping by $4.3 and $1.86 per barrel, respectively. This decline could translate into a decrease of Rs 7.85 and Rs 3.75 in local diesel and petrol prices. Presently, global prices stand at $104.76 per barrel for diesel and $107.16 for gasoline.

Analysts in the petroleum industry anticipate a downward trajectory in global petroleum product prices, indicating a potential adjustment in local costs. However, they caution against the ongoing volatility in global prices, which casts uncertainty over the next four to five days.

The government’s pricing strategy for petroleum products is influenced by various factors, including global oil prices, local currency value, expected fuel consumption, and operational expenses of state-owned entities like Pakistan State Oil. Monthly tax targets also hold significant sway.

Pakistan heavily relies on oil imports for approximately 85% of its needs, presenting challenges in terms of balance of payments and surging inflation. To navigate these economic hurdles, the government secured a $3 billion loan from the International Monetary Fund in July 2023. This agreement mandates the implementation of austerity measures, such as tax hikes, escalating energy expenses, and the adoption of a market-based currency exchange rate.

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Update on Petrol Prices in Pakistan (April 2024): As of April 15, 2024, the government had raised petrol prices by Rs 4.53 per liter, reaching Rs 293.94 per liter. High-speed diesel also experienced an increase of Rs 8.14 per liter, reaching Rs 290.38 per liter. However, the anticipated drop in global prices could soon alter these figures, offering potential relief to consumers.