The price of petrol is likely to come down by Rs34.57 per litre in line with fluctuations in global oil prices and appreciation of the rupee against the US dollar, effective from October 16, 2023.
However, final decision will be made by the interim government, which may resort to adjustment of tax rates for petroleum products.
According to sources, the price of petrol may drop by Rs34.57 to Rs288.38 per litre compared to the existing rate of Rs323.38.
Petrol is mainly used in motorbikes and cars and is an alternative to compressed natural gas (CNG), especially in Punjab, where locally produced gas is not available at CNG filling stations.
Later, liquefied natural gas (LNG) was being used in CNG retail outlets but that has also gone scarce for the past couple of years as Pakistan Petroleum Limited (PLL) could not strike import contracts.
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Secondly, the private sector has been struggling to import LNG since 2015 but all their efforts have come to nothing because the public gas utilities want to maintain their monopoly over gas supplies.
Like petrol, the price of high-speed diesel (HSD) may go down by Rs15.91 to Rs302.18 per litre for the next fortnight.
HSD is primarily used in agriculture and transport sectors and any reduction in its price may have a positive impact on inflation.
The price of kerosene oil, the consumption of which increases manifold in far-flung areas during winter, is expected to be slashed by Rs21.95 to Rs215.33 per litre compared to the current rate of Rs237.28.
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Kerosene oil is used for cooking purpose in remote areas like northern parts of the country. Pakistan Army is a major consumer of kerosene oil.
The price of light diesel oil, which is used in industrial units, is likely to fall by Rs18.29 to Rs194.16 per litre compared to the existing price of Rs212.45.
At present, the government is charging Rs50 per litre as petroleum levy on HSD with room for a further increase of Rs10. However, the levy on petrol is already at the maximum level of Rs60 per litre.
According to sources, the prices of petroleum products on the Platts index have dropped drastically and also the rupee has strengthened versus the dollar. Average gains for the rupee are calculated at Rs7.50 for the past 13 days.
Published in The Express Tribune, October 14th, 2023.
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