The federal government has announced a reduction of Rs5 per litre in the prices of petrol and high-speed diesel (HSD) for the upcoming week, offering a slight reprieve to inflation-weary consumers. The new rates will take effect from May 16, according to a notification from the Petroleum Division.
Following the adjustment, the price of petrol now stands at Rs409.78 per litre, while high-speed diesel is priced at Rs409.58 per litre. This move reverses the trend of the previous weekly review, which saw a steep hike of Rs14.92 for petrol and Rs15 for HSD.
Global Oil Volatility Drives Weekly Reviews
Pakistan has been reviewing petroleum prices on a weekly basis since the US-Israeli conflict with Iran escalated on February 28. The geopolitical turmoil has triggered a global fuel crunch, primarily due to the disruption of the Strait of Hormuz, a critical maritime chokepoint through which approximately one-fifth of the world’s oil and gas supplies transit during peacetime.
The latest price cut comes despite a surge in global crude oil benchmarks. Oil prices climbed more than 3% on Friday, gaining over $3 a barrel, after comments by US President Donald Trump and Iran’s foreign minister dampened hopes for a swift resolution to ship attacks and seizures around the strait. Brent crude futures settled at $109.07 a barrel, while US West Texas Intermediate (WTI) futures rose to $105.02. Over the week, Brent has climbed 7.72% and WTI 10.11%.
Inflationary Impact on Households and Transport
The fluctuation in fuel prices carries significant consequences for the Pakistani economy. Petrol is predominantly used by commuters in private vehicles, rickshaws, and two-wheelers, directly impacting the budgets of middle and lower-middle-class households.
Conversely, high-speed diesel is a critical inflationary driver. It powers the heavy goods transport sector, including trucks, buses, and trains, as well as agricultural machinery like tractors and tube wells. Consequently, any increase in HSD prices typically leads to a direct rise in the cost of essential commodities, particularly vegetables and other food items.
- Petrol: Rs409.78 per litre
- High-Speed Diesel (HSD): Rs409.58 per litre
The government continues to navigate a complex economic landscape, balancing international crude price volatility with domestic inflationary pressures as the weekly review cycle persists.
