Petrol prices could reach Rs1,000 per litre if fuel shortage takes place in Pakistan, Petroleum Minister Ali Pervaiz Malik warned on Sunday as global oil prices continued to rise amid renewed hostilities in the Middle East.
Speaking to journalists in Lahore, Malik said that petroleum prices had already increased by “50% in Pakistan”, while fuel prices in Europe and the United States (US) had also risen. He said that Houthi attacks on Saudi Arabia were unacceptable and added that the government was providing relief to vulnerable segments of society to ease the impact of higher fuel costs.
Malik also stated that work had begun on oil wells and the government expected a domestic crude oil discovery by October. Such a discovery could help reduce the country’s reliance on imported oil.
The warning came after a sharp rise in fuel prices amid volatility in global oil markets following renewed hostilities in the Middle East and the closure of the Strait of Hormuz. The escalation followed the collapse of a fragile ceasefire reached between Tehran and Washington in June, while Houthi attacks on Saudi Arabia’s civilian and economic infrastructure raised concerns over disruptions to energy shipments.
Following the latest price revision, petrol is being sold at Rs389.14 per litre, while high-speed diesel (HSD) costs Rs424.04 per litre.
The government has introduced relief measures as fuel prices have risen. Prime Minister (PM) Shehbaz Sharif launched a scheme last Sunday offering a Rs100 per litre discount on petrol for motorcyclists, rickshaw and Chingchi owners and drivers of vehicles up to 800cc.
Federal Minister for IT and Telecommunication Shaza Fatima later announced three changes to the scheme. The eligibility cut-off for motorcycles was moved from 2011 to January 1, 2006, following feedback from citizens and journalists.
The government also removed the previous five-litre limit per token, allowing eligible two and three-wheeler users to purchase fuel according to their requirements. Each eligible user can obtain four tokens per month, with each token providing Rs500 in relief.
Meanwhile, the government moved to daily fuel pricing on July 17 after renewed hostilities between Iran and the US and changes in international oil prices.
Before the mechanism was introduced, the government had announced weekly fuel price revisions since early March along with fuel conservation measures linked to possible disruptions in oil supplies during the Middle East conflict. It had also announced targeted measures for subsidised fuel in April.
Petrol is mainly used for private transport, small vehicles, rickshaws and two-wheelers, while HSD is widely used by heavy transport, power plants and large generators. Petrol and HSD are also the major revenue-generating petroleum products, with monthly sales of around 700,000 to 800,000 tonnes, compared with monthly kerosene demand of about 10,000 tonnes.
