Petroleum prices in Pakistan are expected to rise starting November 16, 2024. The Oil and Gas Regulatory Authority (OGRA) will review the proposed price adjustments from oil companies. Ultimately, the final decision will be made in consultation with the Prime Minister.
Projected Price Increases
According to projections, petrol may increase by Rs 2.50 per liter. Similarly, high-speed diesel (HSD) could rise by Rs 5.91 per liter. In addition, kerosene oil might go up by Rs 5.54, while light diesel oil (LDO) could increase by Rs 5.90 per liter. Consequently, this will put additional pressure on consumers, especially following the hike on October 31.
Global Oil Price Trends
Despite a 25% drop in crude oil prices over the last month, global fluctuations continue to impact local prices. For instance, Brent crude dropped to $71.82 per barrel, while US West Texas Intermediate (WTI) rose slightly to $68.07 per barrel. Additionally, the international price of petrol climbed from $75.6 to $77.2 per barrel, and HSD prices rose from $83.6 to $88 per barrel.
Tax Impact
The government continues to impose a fixed tax on petroleum products. Currently, this includes Rs 76 per liter for both petrol and HSD. Of this, Rs 60 is the petroleum development levy, and Rs 16 is a customs duty. As a result, these taxes contribute significantly to the increased costs.
Consumer Impact
With household budgets already under strain, this hike will further impact daily expenses. As fuel prices increase, transportation and goods costs will rise as well, further squeezing consumers’ finances. Thus, the overall cost of living will likely increase for many.
