Petrol, Diesel Prices in Pakistan Likely to Drop from May 1

Pakistan may experience a welcome relief from inflation woes as petrol prices are poised to decrease amidst fluctuations in global oil prices.

With diesel and gasoline observing a decline of $4.3 and $1.86 per barrel, respectively, in the international market, domestic consumers could witness a decrease of Rs7.85 and Rs3.75 in their prices.

Currently, international prices stand at $104.76 per barrel for diesel and $107.16 per barrel for petrol.

Industry analysts anticipate a downward trend in petroleum product prices globally, hinting at a potential adjustment in local costs. However, while prospects appear optimistic, experts caution against the volatility in global prices, highlighting uncertainty in future trends over the next few days.

The government’s decision-making process regarding petroleum product prices considers various factors, including global oil prices, local currency valuation, expected fuel consumption, and supply costs of state-owned entities like Pakistan State Oil, along with monthly tax targets.

Pakistan, heavily reliant on oil imports for about 85% of its needs, grapples with balance of payments challenges and soaring inflation. To navigate economic challenges, the government entered a $3 billion loan agreement with the International Monetary Fund in July 2023, committing to austerity measures such as tax hikes, energy cost adjustments, and adopting a market-based currency exchange rate.

Recent petrol prices in Pakistan saw an increase on April 15, 2024, with petrol rising by Rs4.53 per litre to reach Rs293.94 per litre, and high-speed diesel increasing by Rs8.14 per litre to Rs290.38 per litre.