Petrol likely to drop by Rs12 as rupee gains

Officials say diesel may reduce by Rs9.17 per litre

ISLAMABAD:

Finance ministry officials said there was a possibility of a decrease in the prices of petroleum products because of the increase in the value of the rupee.

According to the authorities, for the next fortnight from October 1, the price of a litre of petrol might fall by Rs11.98 while the rate of high-speed diesel could reduce by Rs9.17 per litre.

They added that the price of kerosene might come down by Rs5.58 per litre.

The finance ministry officials said the people would be unable to avail complete relief if the trend of increasing oil prices in the world market continued and the rupee maintained its gains.

However, they continued that if the global oil prices fell, the people would be able to receive maximum relief.

The government will make the final decision on the prices of petroleum products for the next for fortnight on September 30.

The domestic currency has shown a remarkable recovery in the past 12 consecutive working days, surging nearly 5% to reach a five-week high at Rs292.78 against the US dollar in the interbank market.

This rate is now only Rs5 away from its pre-caretaker government level.

The rupee’s upward trajectory can be attributed to an increase in the supply of foreign currency in local markets, driven by a crackdown on its smugglers and hoarders.

According to the State Bank of Pakistan’s (SBP) data, the rupee strengthened by 0.38% or Rs1.10 in a single day, marking a substantial recovery to Rs292.78 against the greenback.

in a related development, international oil prices edged lower on Friday as a hawkish stance from the US central bank spurred fears of slowing demand, outweighing supply concerns stemming from Russia's fuel export ban.

Brent futures were down 32 cents, or 0.4%, at $92.95 a barrel by 1625 GMT.

US West Texas Intermediate crude (WTI) futures fell 23 cents, or 0.3%, to $89.41 a barrel.

For the week, both benchmarks were set for a decline exceeding 1%.
In the previous three weeks, they rose more than 10% on concerns about tight supply.

US Federal Reserve officials warned of further rate hikes. Higher interest rates increase borrowing costs, which could slow economic growth and reduce oil demand.

(With input from Reuters)