Potential Reduction in Petrol and Diesel Price
The prices of petroleum products in Pakistan are expected to Decrease following a decline in global oil prices. Reports suggest that petrol and diesel prices may drop by Rs 2 to Rs 8 per litre across the country.
Expected New Fuel Prices
Based on market trends, the new expected prices of petroleum products from February 16 are:
- Petrol: Rs 254.90 per litre
- Diesel: Rs 259.20 per litre
This reduction follows a 6% decline in global crude oil prices, which have dropped from $83.40 to $78.35 per barrel.
Recent Price Hike on February 1, 2025
- Higher taxes
- Currency exchange rate adjustments
- Freight margin changes
Petrol Price Breakdown
- Additional duty: Rs 2.47 per litre
- Exchange rate adjustment: Rs 0.23 per litre
- Freight margin reduction: Rs 1.70 per litre (from Rs 6.07 to Rs 4.37)
Diesel Price Breakdown
- Additional duty: Rs 4.03 per litre
- Exchange rate adjustment: Rs 2.46 per litre
- Freight margin increase: Rs 0.47 per litre (from Rs 2.18 to Rs 2.65)
- Distribution margin: Rs 0.07 per litre
With global crude oil prices now decreasing, fuel costs in Pakistan are expected to ease, providing potential relief for consumers.
Factors Influencing the Expected Price Decrease
The anticipated reduction in Pakistan’s petroleum prices is primarily attributed to a recent decline in global crude oil prices. According to the International Energy Agency’s February 2025 report, global oil demand growth is projected to average 1.1 million barrels per day in 2025, up from 870,000 barrels per day in 2024. This increase in supply has contributed to a decrease in crude oil prices.
Additionally, internal reports from the Russian economy ministry and central bank have highlighted significant economic concerns, including lower oil prices, budget constraints, and rising corporate debt. These factors have further influenced the global oil market dynamics.
Recent Trends in Global Crude Oil Price
In recent weeks, global crude oil prices have experienced fluctuations due to various geopolitical and economic factors. For instance, oil futures experienced consecutive session losses due to the potential for peace talks between the U.S. and Russia over the Ukraine war, as announced by President Donald Trump. This possibility eased concerns over supply disruptions.
Moreover, the U.S. Energy Information Administration (EIA) forecasts that Brent crude oil prices will average $74 per barrel in 2025 before falling to $66 per barrel in 2026.
Impact on Pakistan’s Economy
The expected decrease in petroleum price in Pakistan is likely to have several implications:
- Consumer Relief: Lower fuel prices can reduce transportation and manufacturing costs, potentially leading to decreased prices for goods and services.
- Inflation Control: Reduced fuel costs can help in controlling inflationary pressures, benefiting the overall economy.
- Government Revenue: While consumers may benefit from lower prices, the government might experience a decrease in revenue generated from petroleum taxes and duties.
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