As international crude oil prices continue their downward trend, there is growing anticipation that petroleum product prices in Pakistan may also witness a reduction starting from May 1, 2025. Despite this positive development, experts warn that the impact on consumers may be limited due to recent government policy changes.
Global crude oil prices have seen a steady decline, with Brent crude futures currently trading at $66.60 per barrel and US West Texas Intermediate (WTI) crude at $62.85 per barrel. Analysts expect these prices to fall by another 2.9% this week, driven by a potential increase in production from OPEC+ and hopes for a ceasefire in the Russia-Ukraine conflict that could further boost global oil supply.
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Traditionally, a decrease in international crude oil prices has translated into lower costs for petroleum products in Pakistan. However, the government’s recent decision to abolish the Fifth Schedule, which previously capped the petroleum levy at Rs70 per liter, has introduced uncertainty. Under the new framework, the government now holds the authority to adjust the petroleum levy without any set limit, raising concerns that the benefit of falling crude oil prices may not be passed on to the consumers.
Earlier this month, on April 15, the government maintained the prices of petroleum products for the next 15 days despite the declining trend in the global market. Instead of offering relief to the public, authorities opted to increase the petroleum levy, resulting in no change in fuel prices. At present, petrol is priced at Rs 254.63 per liter, while high-speed diesel (HSD) is available at Rs 258.64 per liter.
As May 1 approaches, the public remains hopeful for a price cut. However, with the government’s newfound flexibility in adjusting the petroleum levy, experts caution that the expected relief could be minimal or delayed.
