Petrol up Rs2.31 a litre, diesel up 78 paisas for Friday

The government on Thursday raised the price of petrol by Rs2.31 per litre and high-speed diesel (HSD) by 78 paisas per litre for Friday, October 9.

Petrol will now sell at Rs398.96 per litre and HSD at Rs395.72 per litre, according to a Petroleum Division notification. The government continues to collect Rs114 per litre in taxes and duties on petrol and Rs100 per litre on diesel, Dawn reported.

The rise follows Wednesday’s revision, when petrol went up by Rs1.82 per litre and diesel came down by 91 paisas for October 8, The Express Tribune noted.

Prices now change every day

Since July 17, fuel prices have been set daily rather than weekly, after renewed hostilities between Iran and the United States made global oil markets more volatile. The cabinet and the prime minister gave the Oil and Gas Regulatory Authority (OGRA) the job of setting prices each day in line with international markets, Petroleum Minister Ali Pervaiz Malik said at the time.

Before that, the government had been revising prices weekly since early March, along with fuel conservation measures.

How far prices have come

• Petrol started rising from Rs266 per litre in the first week of March and peaked at Rs458.41 on April 3.
• Diesel climbed from Rs281 per litre after the US-Iran war broke out on February 28, peaking at Rs520.35 on April 3.

Both remain well below those peaks but far above their pre-war levels.

Relief and austerity

On September 13, Prime Minister Shehbaz Sharif announced a relief scheme offering Rs100 per litre off petrol for motorcycles, rickshaws and cars of up to 800cc. According to The Express Tribune:

• about 11.8 million people are expected to benefit
• some 10 million motorcycle users and 800,000 rickshaw users can claim relief on 20 litres a month, worth up to Rs2,000
• about one million owners of cars up to 800cc can claim relief on 30 litres a month, worth up to Rs3,000

On September 17, the government brought back austerity measures. Markets and shops must close by 9pm, marriage halls by 10pm and restaurants by 11pm, with takeaway and home delivery exempt. Fuel allocations for official vehicles have been cut by half for three months.

The global picture

Oil prices jumped more than 5 per cent on Thursday before paring gains after President Donald Trump said the US would not attack Iran before the November midterm elections, The Express Tribune reported, citing Reuters. Brent crude was up $3.48 at $103.73 a barrel by mid-afternoon in New York.

Speaking to a National Assembly committee on Thursday, Malik said the government could not change the petroleum levy targets set in the budget without consulting its multilateral partners, and that “the world has never seen diesel this expensive”.

Who feels it

Petrol is used mainly in private cars, rickshaws and motorcycles, so its price hits middle and lower-middle income households. Diesel drives heavy transport, power plants and large generators, so its price feeds into the cost of moving goods. Petrol and diesel are also major revenue earners, with monthly sales of about 700,000 to 800,000 tonnes, Dawn reported.

This article draws on reporting by Dawn, The Express Tribune and Geo News.