Govt reduces petrol price by Rs3.63 per litre, raises high-speed diesel rate by Re0.31

On Wednesday, the government decreased the price of petrol by Rs3.63 per litre, while raising the cost of high-speed diesel (HSD) by Re0.31 per litre. As a result, petrol will now retail at Rs390.23 per litre, and HSD will cost Rs396.96 per litre. Tax and duties on petrol remain at Rs114 per litre, and on diesel at Rs100 per litre.

The new prices will take effect from October 16 (Friday), according to the Petroleum Division's notification. The diesel price has dropped from its April 3 peak of Rs520.35, having started increasing from Rs281 per litre after the US-Iran war began on February 28. Conversely, petrol prices peaked at Rs458.41 on April 3 after climbing from Rs266 in early March.

In response to the escalating fuel prices due to the Middle East conflict, the government has implemented several austerity measures. Markets must close by 9pm, and fuel allocations for official vehicles have been reduced by 50% for three months. Prime Minister Shehbaz Sharif also announced a "relief scheme" for motorcycle, auto, and 800cc vehicle owners to alleviate the burden of rising global oil prices.

Since July 17, the government has been fixing fuel prices daily in response to fluctuations in international market prices following renewed hostilities between Iran and the US. Previously, fuel prices were revised weekly since early March, along with fuel conservation measures due to potential oil supply disruptions caused by the Middle East conflict. The federal government also announced targeted relief measures to provide subsidized fuel in April.

Petrol is primarily used in private transport, small vehicles, rickshaws, and two-wheelers, making price changes particularly impactful on the middle and lower-middle classes. Diesel, on the other hand, is mainly used in heavy transport, power plants, and large generators, affecting a broader segment of the population. Petrol and high-speed diesel (HSD) generate the majority of revenue, with monthly sales of around 700,000 to 800,000 tonnes, compared to just 10,000 tonnes of monthly demand for kerosene.