Petrol price cut by Rs3.63, diesel becomes costlier

The federal government has reduced the price of petrol by Rs3.63 per litre while increasing the price of high-speed diesel (HSD) by 31 paisas for October 16.

Under the latest revision, petrol will be available at Rs390.23 per litre, while the price of high-speed diesel has been set at Rs396.96 per litre, according to a notification issued by the Petroleum Division on Thursday.

The adjustment follows a revision announced a day earlier, when petrol became more expensive by Rs1.20 per litre and diesel prices fell by 17 paisas. The government is now reviewing fuel prices daily under a mechanism introduced in July to respond more quickly to changes in international oil markets.

Pakistan’s fuel prices remain under pressure from global market uncertainty and geopolitical tensions. Conflicts in the Middle East, supply disruptions and developments affecting major oil-producing countries and shipping routes can push up crude oil prices and transportation costs. As Pakistan relies heavily on imported petroleum products, fluctuations in international markets have a direct impact on domestic consumers.

International oil prices remained volatile on Thursday as investors assessed possible US measures to ease restrictions on oil tankers operating outside mainstream markets. Meanwhile, tensions in the Middle East continued to support a geopolitical risk premium.

Brent crude rose by two cents, or 0.02%, to $106.08 per barrel, while US West Texas Intermediate crude futures climbed $2.96, or 3.11%, to $98.05 per barrel. A significant decline in US crude inventories helped support the US benchmark.

Analysts at MUFG said tensions involving Saudi Arabia and Yemen’s Houthi movement continued to influence oil market sentiment. However, they noted that energy infrastructure had not been attacked in the preceding several days.

The government has also introduced relief measures to reduce the burden of rising fuel costs on lower-income consumers. In September, Prime Minister Shehbaz Sharif announced a proposed subsidy of Rs100 per litre for motorcycles, three-wheeler rickshaws and cars with engine capacities of up to 800cc.

The scheme was expected to cover around 11.8 million beneficiaries. Eligible motorcycle and rickshaw users were to receive relief on up to 20 litres of fuel per month, with a maximum monthly benefit of Rs2,000. Owners of eligible small cars were to receive relief on up to 30 litres, amounting to a maximum of Rs3,000 per month.

The government also revived austerity and fuel conservation measures in September in response to rising petroleum costs. Under the restrictions, most shops and markets were directed to close by 9pm, while marriage halls and similar venues were required to shut by 10pm. Restaurants and food outlets were permitted to operate until 11pm, with takeaway and home delivery services exempt from the restrictions.