Global oil prices drop 12% in three days, Pakistanis still await fuel price relief

Pakistani consumers have yet to benefit from a sharp decline in global oil prices, despite international petroleum markets recording a fall of up to 12% over the past three days

Pakistani consumers have yet to benefit from a sharp decline in global oil prices, despite international petroleum markets recording a fall of up to 12% over the past three days. The continued high fuel prices have added to the financial burden on households already struggling with rising inflation.

Over the last 12 days, fuel prices in Pakistan have increased significantly, with diesel becoming Rs. 65.08 per litre more expensive and petrol rising by Rs. 25.10 per litre. The increases followed the federal government’s decision on July 17 to introduce a daily fuel price adjustment mechanism in line with international market trends.

On July 17, petrol was priced at Rs. 310.71 per litre, while high-speed diesel was available at Rs. 323.30 per litre. As of July 29, petrol is being sold at Rs. 335.81 per litre, whereas diesel has climbed to Rs. 388.38 per litre, marking one of the steepest short-term increases in recent years.

Although consumers witnessed two minor reductions in petrol prices during this period, the relief was limited. Petrol prices were cut by Rs. 0.35 per litre on July 21 and by Rs. 1.00 per litre on July 27. Diesel prices, however, have not been reduced since the daily pricing mechanism came into effect.

International oil markets experienced a sustained upward trend after July 17, contributing to higher domestic fuel prices. However, between July 25 and July 28, global petroleum prices fell sharply, with reports indicating a decline of approximately 12% across major international benchmarks.

Despite this significant drop in global prices, Pakistani consumers have not yet received any corresponding reduction at the pump. The absence of immediate relief has sparked concerns among motorists and businesses, particularly those heavily dependent on transportation and logistics, where fuel costs directly affect operating expenses.

Economists note that lower international oil prices, if sustained, could create room for a reduction in domestic fuel prices in the coming days. Any adjustment, however, will depend on several factors, including exchange rate movements, government taxes and levies, freight costs, and the pricing formula adopted by the authorities.

With inflation continuing to squeeze household budgets, many consumers are hoping the recent decline in global oil prices will soon translate into lower petrol and diesel prices in Pakistan, easing transportation costs and reducing pressure on the overall cost of living.