Starting September 1, 2024, petrol prices in Pakistan are set to decrease by Rs 5-6 per litre, marking the third straight fortnight of price cuts.
This reduction is welcome news for consumers, driven by favorable global oil market conditions and a stronger local exchange rate.
Global Oil Price Decline
The anticipated drop in petrol prices is mainly due to a recent decline in global oil prices. Over the past two weeks, oil prices have fallen by $2 to $2.30 per barrel.Specifically, the average price of petrol has dropped from $82.50 to $80.40 per barrel, while high-speed diesel (HSD) has decreased from $90.30 to $88 per barrel.
Additionally, the import premium on petrol has reduced by 50 cents per barrel, further supporting the expected decrease in local fuel prices.
Exchange Rate Influence
The appreciation of the Pakistani rupee against the US dollar has also significantly contributed to the expected reduction in petrol prices.The local currency gained 25 cents against the dollar during the same period, which has lowered the cost of petroleum imports.
Current and Previous Price Adjustments
As of the most recent review on August 14, 2024, the ex-depot price of petrol stands at Rs 260.96 per litre, with HSD priced at Rs 266.07 per litre.In the previous review, the government reduced petrol prices by Rs 8.47 per litre and HSD by Rs 6.70 per litre, resulting in a cumulative reduction of Rs 14.64 per litre for petrol and Rs 17.56 per litre for HSD over the last two fortnights.
In July 2024, there were further reductions of Rs 6.17 and Rs 10.86 per litre after significant increases earlier in the month.
Between May 1 and June 15, 2024, petrol prices saw a decrease of about Rs 35 per litre, while HSD prices were cut by Rs 22 per litre.
September Outlook
With global oil prices on a downward trend and the Pakistani rupee showing strength, consumers can expect further price relief at the pumps in September 2024.This anticipated drop in petrol prices is a positive sign for the economy, offering much-needed financial relief to both households and businesses across the country.
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