The interim government has announced a reduction in petrol prices in Pakistan today. The new price of petrol will be Rs. 259.34, down from the previous Rs. 267.34. Diesel prices, however, remain unchanged. These new prices will take effect from January 16, 2024 and will last for the next two weeks.

Earlier reports from the media had suggested a reduction of Rs. 5 per liter, while some experts believed the decrease would be closer to Rs. 8-10 per liter. The changes in prices were anticipated due to the performance of the Pakistani Rupee against the US Dollar and international oil prices. Official sources indicated that data collected suggested a reduction of Rs. 5 per liter for petrol and Rs. 0.26 per liter for high-speed diesel.

Additionally, data from the past 13 days indicated a reduction of Rs. 3.29 per liter for kerosene oil and Rs. 1.75 per liter for light diesel oil (LDO).

According to the data, the probable ex-refinery price of petrol as of January 16 is expected to be Rs. 180.29 per liter.

No Change in the Previous Update

On January 1, the interim federal government announced no change in petrol and diesel prices in Pakistan. A notification from the Finance Division stated, “The government of Pakistan has decided to maintain the current prices of petrol and high-speed diesel (HSD) during the fortnight starting January 1, 2024.” The Oil and Gas Regulatory Authority (OGRA) recommended maintaining the rates.

Pakistan heavily relies on imported oil, with 70% of petroleum goods being imported to meet local demand. In November 2023, the country saw a 5.76% increase in the year-on-year import bill for petroleum goods, rising to $1.32 billion from $1.25 billion in the same period the previous year. This indicated a steady increase in imports and the country’s spending.

Last year, Pakistan experienced its highest-ever petrol and diesel prices, with petrol reaching Rs. 331 per liter in September. We compiled a detailed blog on petroleum prices in 2023, which can be read here.During the first quarter of 2023, the high prices led to low fuel consumption, but the second quarter saw relative price stability, and even a decrease in prices, indicating a more stable situation.

Economic and political stability are crucial for Pakistan to maintain affordable prices. Hopefully, 2024 will bring more stability to the country’s economy, bringing relief to the masses.

What are your thoughts on the current petrol and diesel prices in Pakistan? Let us know in the comments section.