Pakistan cut petrol prices by Rs3.40 per litre and high-speed diesel by Rs7.76 per litre on Monday, November 2, with the new rates taking effect across the country from Tuesday, November 3, the Oil and Gas Regulatory Authority (OGRA) announced.
Petrol will now sell at Rs374.51 per litre, down from Rs377.91, while high-speed diesel will cost Rs395.20 per litre, down from Rs402.96, according to the regulator’s notification. The cut brings some relief to motorists after weeks of high fuel costs, and the larger diesel reduction matters most for freight operators and farmers, who run trucks and agricultural machinery on diesel.
OGRA said the revised ex-depot prices were calculated under the federal government’s petroleum pricing mechanism, which takes international Platts prices, premiums and other incidental costs into account. The new rates replace those set in the previous revision, when petrol was left unchanged at Rs377.91 per litre and diesel was raised by Rs2.29 per litre to Rs402.96.
Monday’s announcement marked the first cut in petrol prices after the rate had stayed unchanged in the previous revision. Diesel users get the bigger benefit this time, with a reduction more than twice the size of the petrol cut.
Petroleum Minister Ali Pervaiz Malik told a press conference in Islamabad on Monday that the government had worked out a refinery-backed arrangement to shield consumers from the full impact of soaring international fuel costs. Under the arrangement, domestic refineries will shoulder an estimated Rs15 billion burden every month, he said.
Malik said the arrangement would keep petrol approximately Rs15 per litre below the price that prevailing international costs would otherwise require. He said Prime Minister Shehbaz Sharif had held consultations with refinery representatives to find ways of limiting the impact of rising oil prices amid the US-Israeli war on Iran.
OGRA has also begun publishing daily petroleum prices on its website, under a new daily price review mechanism. Malik said the daily prices are based on a seven-day average of international market prices, in line with international practice, so changes in global oil rates reach consumers more quickly than before.
Global oil prices fall on Iran talks hopes
International oil prices fell about 6% on Monday as talks between Iranian and Qatari officials on ending the US-Israeli war with Iran raised hopes of easing supply disruptions in the Middle East. Brent crude futures fell $6.78, or 6.0%, to $106.65 a barrel, while US West Texas Intermediate crude declined $6.37, or 6.1%, to $97.75 a barrel.
Iran’s president said the country’s supreme leader had granted the government “certain authorities” regarding peace talks, according to reports of the discussions. Any easing of the conflict would matter for energy markets because Tehran shut the Strait of Hormuz, the route for around a fifth of global energy supplies, after Israel and the United States attacked Iran on February 28.
Tensions have mounted since a fragile June truce between Tehran and Washington collapsed, reviving fears of full-scale war and disrupting energy flows through the region. The government had introduced a weekly fuel price review system after the conflict began, and has now moved to daily reviews amid the continuing volatility.
What is confirmed is the size of the cuts, the new prices and the date they take effect: petrol down Rs3.40 to Rs374.51 per litre and diesel down Rs7.76 to Rs395.20 per litre, from November 3, under OGRA’s notification. What is not fixed is how long these rates will hold, because OGRA now publishes prices daily and the next movement will depend on international market prices. The refinery arrangement is meant to keep petrol below the full international-cost level, but its monthly cost to refineries, estimated at Rs15 billion, will test how long that cushion can last.
