The federal government has lowered the prices of petrol and High-Speed Diesel (HSD) on Tuesday, cutting petrol by Rs3.39 per litre and diesel by Rs4.07 per litre.
With the new prices taking effect on Wednesday, August 5, petrol will retail at Rs328.56 per litre while HSD will cost Rs385.86 per litre. The government retains taxes and duties worth Rs110 per litre on petrol and Rs96 per litre on diesel.
The revision comes after months of sharp price spikes linked to the United States (US)-Iran conflict that began on February 28. Diesel started rising from Rs281 per litre in late February and hit a peak of Rs520.35 on April 3. Petrol followed a similar path, climbing from Rs266 in early March to a peak of Rs458.41 on April 3.
In July, Petroleum Minister Ali Pervaiz Malik announced that the government will move away from weekly adjustments and instead fix fuel prices on a daily basis to match international market swings.
“The cabinet and the prime minister decided to give the Oil and Gas Regulatory Authority the responsibility of deciding fuel prices on a daily basis based on international market trends,” Malik said.
The government implemented weekly price revisions and fuel conservation plans in March to handle supply disruptions caused by the Middle East conflict. The federal government also introduced targeted fuel subsidies in April.
Price shifts in both fuels hit different sectors of the economy. Petrol powers private vehicles, small cars, rickshaws, and two-wheelers, directly affecting daily expenses for middle and lower-middle-class commuters. High-speed diesel powers heavy transport, power plants, and industrial generators, influencing transport fares and goods delivery across the country.
Petrol and diesel remain the primary revenue drivers for the petroleum sector, generating combined monthly sales between 700,000 and 800,000 tonnes, compared to monthly kerosene demand of 10,000 tonnes.
