Govt increases petrol price by Rs6.39, diesel by Rs7.83 per litre
- Petroleum Minister Ali Pervaiz Malik announced that fuel prices will now be fixed on a daily basis.
- The minister stated that the prime minister and the cabinet decided to delegate the responsibility of determining these daily prices to the Oil and Gas Regulatory Authority (Ogra).
- The association had announced the strike only a day prior after negotiations with the government regarding daily petroleum pricing failed.
Daily Pricing Shift and Ogra Mandate
Petroleum Minister Ali Pervaiz Malik announced that fuel prices will now be fixed on a daily basis. This shift from the previous weekly revision cycle, which had been in place since early March, is a response to international market volatility caused by renewed hostilities between Iran and the US, according to the minister.
The minister stated that the prime minister and the cabinet decided to delegate the responsibility of determining these daily prices to the Oil and Gas Regulatory Authority (Ogra). Ogra will now set prices based on international market trends.
Industry Response and Strike Deferral
The association had announced the strike only a day prior after negotiations with the government regarding daily petroleum pricing failed.
Historical Price Volatility and Market Peaks
Current prices reflect a decline from peaks recorded earlier in the year.
Economic Impact and Consumption Patterns
Petrol and HSD serve as the primary revenue earners for the sector, with combined monthly sales ranging between 700,000 and 800,000 tonnes. In contrast, monthly demand for kerosene is approximately 10,000 tonnes.
The government identifies different demographic and industrial impacts based on the fuel type:
- Petrol price changes primarily affect the middle and lower-middle classes, as the fuel is used in two-wheelers, rickshaws, small vehicles, and private transport.
- Diesel price changes impact the broader public through the heavy transport sector, large generators, and power plants.