ISLAMABAD: Amid low fuel demand locally, the government slashed prices of petrol by Rs1.57 per litre effective from Sunday (today), the Ministry of Finance announced in a statement issued here on Saturday.

With a cut of Rs1.57, the price of petrol has been reduced from Rs103.97 to Rs102.40 per litre. High speed diesel (HSD) will be sold for Rs103.22 per litre, down from Rs104.06 after a reduction of Rs0.84 per litre. However, the per litre price of kerosene oil and light diesel oil remained unchanged at Rs65.29 and Rs62.86, respectively.

Internationally, oil prices have inched down while an increase has been registered in the prices of liquefied petroleum gas (LPG), mainly due to a surge in demand as winter approaches.

HSD is the most widely consumed fuel in the country and its prices have serious impact on the transport and agriculture sectors. HSD is also used for operating generators during summers when load shedding increases. However, there is no major demand from the agriculture sector or for running generators in the month of November. Besides, business activities and the transport sector have been subdued since Covid-19 made its way to Pakistan and yet to return back to normalcy.

The oil industry had projected nationwide HSD demand at 0.71 million tonnes in October, but sales witnessed a decline of 16.40 per cent at 0.59m tonnes, as transport sector remained sluggish. International trade with China as well the movement of trucks at the Pak-Afghan border remained limited.

Similarly, with reduced internal movement petrol consumption witnessed a decline of almost 20pc from the projected demand of 0.76m tonnes in October but the oil companies sold around 0.60m tonnes.

A senior official of an oil marketing company said the industry is projecting a demand of 0.71m tonnes for petrol and 0.70m tonnes for HSD in November.

A surge in LPG rates has been witnessed at the international markets, with prices reaching to $437 per tonne from $379 tonne ­— an increase of more than Rs9,386 per tonne in local prices.

The Oil and Gas Regulatory Authority has issued the new official price showing an increase of Rs10 to around Rs118 per kg. The increase will take its toll on the residents of remote areas in the country including Gilgit-Baltistan where residents do not have access to any other means for heating their homes amid gas load shedding in harsh winter months.

Published in Dawn, November 1st, 2020