The government on Thursday announced a reduction of Rs15 per litre in the price of petrol, of Rs27.15 per litre in the price of high speed diesel (HSD), Rs30.01 per litre in the price of kerosene and of Rs15 per litre in the price of light diesel oil (LDO).

The price of petrol has been reduced to Rs81.58 from Rs96.58, while HSD will be available at the rate of Rs80.10 after a reduction of Rs27.15 from Rs107.25 per litre. The price of kerosene has been reduced to Rs47.44 from Rs77.45 and LDO, which was previously priced at Rs62.51 will now be priced at Rs47.51.

According to a notification issued by the Ministry of Finance, the government made the decision to slash prices of petroleum products to "provide relief to consumers".

"The government is extending maximum relief to the public. Relief packages include economic stimulus package, Ehsaas emergency relief programme, incentive package for SMEs and many other relief measures. The latest one is [a] considerable decrease in the prices of petroleum products," the notification read.

The new prices will come into effect from May 1.

Earlier on Wednesday, the Oil and Gas Regulatory Authority (Ogra) had recommended up to Rs44.07 per litre reduction in the price of major petroleum products for the month of May to share the benefit of lower international prices with the consumers.

The regulatory authority had proposed a decrease of Rs33.94 to Rs73.31 for the price HSD, a drop of 31.6 per cent from Rs107.25.

It had also worked out a decrease of Rs20.68 per litre (down 21.4pc) to Rs75.9 for petrol, which previously stood at Rs96.58.

Ogra had also proposed that kerosene oil's price be cut by Rs44.07 to Rs33.38 per litre, a 56.9pc decline from the Rs77.45 per litre rate that went into effect in late March.

For LDO, the price was recommended to be slashed by Rs24.57 (-39.3pc) to Rs37.94 per litre.

The reduction in fuel prices comes as oil prices slumped amid concern about dwindling crude storage capacity worldwide and fears that fuel demand may only recover slowly once countries ease curbs imposed on economic and social activity to combat the coronavirus pandemic.

Oil prices have fallen to historic lows this month, with the US benchmark West Texas Intermediate crashing deep below zero for the first time as governments worldwide shut down businesses and air travel grinds to a halt due to the virus.

An agreement by top crude-producing nations to cut output by 10 million barrels a day from May 1 has done little to calm the market.

The production cuts "will probably take weeks to show up in the physical market, hence we are still stuck with the inventories issues that will continue to curb any semblance of bullish appetite", said AxiCorp global market strategist Stephen Innes.