Petrol price drops by Rs3.63, why diesel becomes more expensive?
New petrol and diesel prices announced
The government has reduced the petrol price to Rs390.23 per litre, while high-speed diesel will now cost Rs396.96 per litre. According to a Petroleum Division notification, the revised rates will take effect on Friday, October 16.
The government continues to collect Rs114 per litre in taxes and duties on petrol and Rs100 per litre on diesel. The small increase in diesel prices may add pressure on transport and other businesses that rely heavily on the fuel.
Fuel prices remain below April’s peak
Diesel prices have fallen considerably from their record high of Rs520.35 per litre on April 3. Its price had started rising from around Rs281 per litre after the US-Iran war began on February 28.
Petrol also reached a peak of Rs458.41 per litre on April 3, after rising from Rs266 in the first week of March. The latest reduction offers some relief to petrol users, although fuel prices remain high.
Government brings back fuel-saving measures
The government has reintroduced austerity measures to conserve fuel amid the ongoing conflict in the Middle East. Under these rules, markets must close by 9pm, while fuel allocations for official vehicles have been cut by 50 per cent for three months.
On September 13, Prime Minister Shehbaz Sharif announced a relief scheme for motorcycles, rickshaws and vehicles with engines of up to 800cc to “alleviate the burden” of rising global oil prices. The scheme was intended to help people affected by higher fuel costs.
Daily fuel pricing and its impact
Petroleum Minister Ali Pervaiz Malik announced on July 17 that fuel prices would be set daily because of changes in international oil prices and renewed tensions between Iran and the United States. Before this change, the government had been revising fuel prices weekly since early March.
The petroleum minister said the cabinet and prime minister had assigned the Oil and Gas Regulatory Authority (Ogra) the responsibility of setting daily prices according to international market trends. The federal government had also announced targeted fuel subsidies in April to provide relief to selected groups.
The petrol price cut offers some relief to private vehicle owners and motorcycle users, but the diesel increase may affect transport costs. Higher transport expenses can also push up the prices of goods and services.
The government is trying to balance public relief with fuel conservation as international tensions continue. Future price changes will depend largely on movements in the global oil market.
Also read: Election Commission set to issue Punjab local govt election schedule
