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Thursday April 25, 2024

Petrol price in Pakistan likely to go down by over Rs30 per litre

Sources say Petroleum Divison recommends increasing OMCs and petroleum dealers' margins

By Saifur Rahman & Web Desk
October 15, 2023
An employee of a gas station fills the tank of a motorbike in Karachi, on July 16, 2021. — AFP
An employee of a gas station fills the tank of a motorbike in Karachi, on July 16, 2021. — AFP

ISLAMABAD: Massive relief is expected in fuel prices today as the government will announce new rates today (Sunday) for the next fortnight while sources said the profit margins of oil marketing companies (OMCs) and petroleum dealers may also go up.

The federal government is expected to slash petrol by Rs36 and high-speed diesel (HSD) by Rs19 per litre today due to a recent decline in the international oil prices and appreciation in the value of local currency against the US dollar, effective October 16.

Sources told Geo News that an 88 paisas per litre increase has been recommended by the Petroleum Division in the profit margins of oil marketing companies and dealers from October 16.

The federal government has been recommended to hike OMCs profit margins by 47 paisas while dealers’ margins by 41 paisas, they added.

Currently, OMC's profit margin is Rs6.94 per litre of petrol and dealers’ margin is Rs7.82 per litre of petrol, according to Petroleum Division sources.

Similarly, the profit margin of OMCs on per litre diesel is Rs7.8 while dealers' margin on per litre diesel is Rs7.82, sources said.

Earlier this month, a brokerage firm Friday predicted a massive decline of Rs41 and Rs19 per litre in the prices of petrol and diesel, respectively, on Oct 16.

Arif Habib Limited (AHL), in its forecast, had also predicted a 92 bps drop in inflation rates, down to 27.5%, attributing the decrease to price fluctuations in commodities and global currency markets.

The firm cited the recent significant decline in international oil prices due to demand uncertainties, a stronger US dollar, inflationary pressures, and rising supplies over the past week.

In its last fortnightly announcement of fuel prices, the Ministry of Finance provided some relief to the country's inflation-weary masses and dropped the price of petrol for the next fortnight by Rs8, the first time in two and a half months.

A cut of Rs11 was announced in the diesel price, after which the new fuel rate was set at Rs318.18 per litre.