Article
Pakistan may get a small relief at the pumps in the first half of September, with industry estimates projecting cuts across major petroleum products. If the working paper holds, the ex-depot sale price of petrol (motor gasoline) will fall Rs0.61 per litre to Rs264.00, while high-speed diesel (HSD) — the country’s most used transport fuel — is expected to drop Rs3.13 per litre to Rs269.86 from September 1.
Other fuels are also set for declines: kerosene is forecast down Rs1.78/litre to Rs176.70, and light diesel oil (LDO) is likely to fall Rs2.61/litre to Rs159.55. The ex-refinery adjustments show similar, slightly smaller moves in some cases — for example, petrol’s ex-refinery price is estimated to slide Rs0.43/litre while HSD could drop about Rs2.87/litre.
Why prices are easing
The estimated cuts reflect recent movements in global crude and product markets, shifting import premiums and refiners’ margins. Market sources note motor gasoline premiums are currently calculated near $6.37 per barrel, with HSD premiums around $3.20 per barrel, factors that feed into the local pricing formula alongside freight, refining costs and taxes.
Key components that still matter
Domestic pump prices are not set by international rates alone. Several home-grown factors can amplify or offset the projected relief:
- Currency swings: The working paper explicitly excludes exchange-rate gains or losses. A weaker rupee would increase landed import costs and could erase the projected cuts, while a stronger rupee would deepen consumer relief.
- Inland Freight Equalisation Margin (IFEM): The IFEM (currently applied at Rs8.05/litre for petrol and Rs6.20/litre for diesel) affects final retail parity across provinces.
- Levies and taxes: The Petroleum Levy (PL) and its Climate Support Levy (CSL) component remain part of the end price consumers pay.
- One trading day left: With one Platts trading day remaining before the official cut-off, last-minute benchmark moves may nudge the final figures.
What happens next
The Ministry of Finance typically signs off on fortnightly changes after reviewing OGRA’s working paper. That formal notification is the definitive step before oil marketing companies update retail rates. Observers advise watching the Finance Ministry’s announcement closely — and the rupee-dollar rate between now and the cut-off — for any last-minute adjustments.
Who benefits — and who should still be cautious
Consumers may see small savings when refuelling private vehicles or buying kerosene for household use. The larger diesel reduction could slightly ease costs for haulage and public transport operators, but the modest percentage changes (petrol ~0.2%, diesel ~1.1%, kerosene ~0.9%, LDO ~1.6%) mean the relief will be limited unless accompanied by currency appreciation or broader international declines.
Bottom line
The provisional cuts for September 1 offer modest but welcome relief, especially for diesel-dependent sectors. Yet volatility in the foreign-exchange market and the final Platts benchmark could reduce — or even reverse — the benefit before prices are officially declared. Consumers and businesses should monitor the Finance Ministry and OGRA updates over the coming days to confirm the final rates.
Read the official OGRA notification for the fortnight’s petroleum prices. Oil & Gas Regulatory Authority
See the Ministry of Finance statement when prices are officially notified. Finance Division Pakistan
Local coverage: Business Recorder reports today’s rate changes and market reaction. Business Recorder
For premium/basis methodology, check S&P Global Platts benchmarks.
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