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Pakistani consumers may soon see relief at the fuel pump as petroleum product prices are expected to decrease following a significant decline in global oil prices.
Market data shows notable reductions in both petrol and diesel ex-refinery prices ahead of the government's upcoming pricing decision.
The expected reduction in petroleum prices comes after a downturn in international oil markets, which has lowered the cost of imported fuel products.
According to market sources, the ex-refinery price of diesel has dropped by Rs31, while the ex-refinery price of petrol has declined by Rs8.54, increasing the possibility of lower retail fuel prices for consumers across Pakistan.
Petrol ex-refinery price records decline
Market sources said the ex-refinery price of petrol fell from Rs277.06 per litre to Rs268.52 per litre, reflecting a decrease of Rs8.54. The decline follows a drop in international petrol prices, with the price per barrel decreasing from $144.57 to $138.08.
However, some upward pressure remains on pricing as customs duty on petrol increased by Rs2.86 per litre, rising from Rs22.75 to Rs25.61.
Petrol premium rises despite lower global prices
Sources further revealed that the premium on petrol increased by approximately $2.90 to $2.99 per barrel. As a result, the premium rose from $17.44 per barrel to $20.34 per barrel, partially offsetting the benefit of falling international oil prices.
Despite the increase in premium costs, the overall decline in crude and refined fuel prices continues to support expectations of a reduction in local petrol prices.
Diesel prices show significant decrease
Diesel prices have recorded a much larger decline compared to petrol. According to market sources, the ex-refinery price of diesel dropped from Rs322.28 per litre to Rs291.37 per litre, a decrease of approximately Rs31.
Similarly, the international diesel price per barrel fell sharply from $169.10 to $151.40, reflecting a reduction of around $17.70 per barrel.
The substantial fall in diesel prices is expected to benefit the transport, agriculture and industrial sectors, which rely heavily on high-speed diesel.
Despite the reductions in international and ex-refinery prices, the final adjustment in petroleum product prices will be determined by the federal government.
Officials said the government will assess various factors before announcing revised fuel prices, including revenue requirements and fiscal targets.
Petroleum levy could determine size of relief
Market experts noted that consumers may receive meaningful relief if the government chooses not to increase the petroleum levy margin rate.
Any increase in the levy could reduce the impact of lower global oil prices on retail fuel rates.
The final decision is expected to be taken by Prime Minister Shehbaz Sharif in consultation with the government's economic team, while keeping revenue targets in view.
For now, declining international oil prices have strengthened expectations that petrol and diesel prices in Pakistan could move lower in the next pricing review.
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