The government on Monday slashed the price of petrol by Rs3.40 per litre, and that of high-speed diesel (HSD) by Rs7.76.
Following the revision, petrol will retail at Rs374.51 per litre, while HSD will cost Rs395.20.
The prices are applicable for Nov 3 (Tuesday), according to a notification by the Oil and Gas Regulatory Authority (Ogra).
The price reductions come under a new arrangement, in which oil refineries would bear a burden of approximately Rs15 billion each month, according to the government. This would allow petrol to be sold Rs15 cheaper than what it was in the global market amid the US-Israeli war on Iran.
The government announced the revised system during a press conference in Islamabad, held by Petroleum Minister Ali Pervaiz Malik and Information Minister Attaullah Tarar.
“I am grateful to all the refineries that saw the public is in difficulty and with the government’s help … increased their throughput,” Malik said, adding that these refineries had made profits from this throughput in the last three months.
“They were requested to take a step to support the public during this difficult time, and I am glad that they listened to us … the Rs15 increase that was coming in the petrol prices on Friday, they helped the government with that. Because of that we were able to maintain the price.”
On Oct 27, Jamaat-i-Islami (JI) chief Hafiz Naeemur Rehman met with Prime Minister Shehbaz Sharif in Islamabad to discuss his party’s demand to provide relief to the public by abolishing the levy.
The two sides agreed to form a joint committee of the JI and the government to consider the expansion of the ongoing fuel relief scheme, being offered to owners of motorcycles, rickshaws and vehicles of up to 800cc since Sept 17.
For his part, Rehman declared that his party would march to Islamabad in protest of the petroleum levy in mid-November if the government did not announce any major relief by then.
Rise in fuel prices
The price of HSD has come down from a peak of Rs520.35 recorded on April 3. Its price had started rising from Rs281 per litre after the US-Iran war broke out on Feb 28.
The petrol price had peaked at Rs458.41 on April 3 after beginning its upward trajectory from Rs266 in the first week of March.
Meanwhile, the government has reintroduced a raft of austerity measures in response to rising fuel prices amid the ongoing Middle East conflict. Under these measures, markets are required to close by 9pm, and fuel allocations for official vehicles have been cut by 50 per cent for three months.
On Sept 13, PM Shehbaz also announced a “relief scheme” for users of motorcycles, autos and vehicles of up to 800cc to “alleviate the burden” of rising global oil prices.
Previously, on July 17, the petroleum minister announced that fuel prices would now be fixed on a daily basis due to fluctuations in international market prices following renewed hostilities between Iran and the US.
Prior to this, the government had been announcing weekly revisions to fuel prices since early March, alongside measures for the conservation of fuel amid possible oil supply disruptions due to the ongoing conflict in the Middle East. The federal government in April also announced targeted relief measures to provide subsidised fuel.
The petroleum minister stated that the cabinet and the prime minister had decided to give Ogra the responsibility of deciding fuel prices on a daily basis based on international market trends.
Petrol is mainly used in private transport, small vehicles, rickshaws and two-wheelers, and changes in its price affect the middle and lower-middle classes.
Similarly, changes in diesel prices also impact the public at large, as it is mainly used in the heavy transport sector, power plants and large generators.
Petrol and HSD are the major revenue earners, with monthly sales of about 700,000 to 800,000 tonnes, compared to just 10,000 tonnes of monthly demand for kerosene.
