Govt cuts petrol by Rs2.93, increases diesel by 61 paisas for Oct 13

Read:Govt cuts petrol by 66 paisas, increases diesel by 52 paisas till Oct 12On July 17, the government announced a new pricing mechanism under which petroleum product prices would be reviewed and notified daily, replacing the weekly pricing mechanism, as renewed tensions between the United States and Iran continued to drive volatility in global oil markets and raise concerns over fuel supplies.

Since daily pricing began on July 21, petrol priceshad been raised 35 times and cut 22 times, while diesel had seen 34 increases and 23 reductions, leaving consumers grappling with persistent price volatility. Read More:Fuel costs keep squeezing household budgets.

On September 13, PM Shehbazannounceda special relief scheme offering Rs100 per litre off petrol for motorcycles, three-wheeler rickshaws and cars with engines up to 800cc, in an attempt to shield lower-income consumers from the impact of rising petroleum prices. Under the proposal, an estimated 11.8 million beneficiaries would be covered.

Around 10 million two-wheeler users and 800,000 three-wheeler users would be entitled to relief on 20 litres of fuel per month, translating into a maximum monthly benefit of Rs2,000 per beneficiary. Another one million users of cars up to 800cc would receive relief on 30 litres per month, providing them with a maximum benefit of Rs3,000 each.

On Sept 17, the government reintroduced austerity and fuel conservation measures amid rising fuel prices, tightening business operating hours and restricting public events. Under the measures, notified with immediate effect, shops, markets, shopping malls, bazaars, departmental stores, grocery stores, general stores and kiryana shops would close by 9pm throughout the week, the Cabinet Division.

Marriage halls, marquees and other commercial venues hosting festive events would close by 10pm, while restaurants, cafes, eateries, food outlets and standalone fruit and vegetable shops would be allowed to operate until 11pm. Takeaway and home delivery services would remain exempt from the timing restrictions. Global geopolitical developments continue to pose significant risks.

International oil prices are influenced by decisions taken by OPEC+, conflicts in the Middle East, sanctions on oil-producing nations, and disruptions in critical shipping routes such as the Strait of Hormuz and the Red Sea. Any interruption in these supply chains can immediately increase crude oil prices and freight costs.

Since Pakistan imports the majority of its petroleum requirements, these developments quickly translate into higher domestic fuel prices. Oil prices were up 2% at near two-week ​highs on Monday as attacks on Saudi Arabia overshadowed the prospect of increased supplies after US President Donald Trump hailed ‌fresh Russian diesel exports and a Russia-Ukraine ceasefire on energy targets.

Rebounding from earlier losses, Brent crude futures were up $2.04, or 2%, to $106.76 a barrel at 11:07 am EDT (1507 GMT), their highest since September 29. US West Texas Intermediate crude was at $93.69 a barrel, up $1.84, or 2%.

"The sense of some kind of normality of exports from the Strait of Hormuz was shattered last week. Fresh ​attacks by the Houthis on Saudi Arabia added to this and helped to lift prices," said SEB commodities analyst Bjarne Schieldrop.