Petrol Prices in Pakistan May Drop from May 1

In a significant development for Pakistani consumers, petrol and diesel prices are poised to decrease starting May 1, 2025. This anticipated reduction aligns with a global decline in crude oil prices, offering potential relief to the inflation-stricken populace.

• Petrol Price Reduction: Expected decrease of Rs 4.88 per litre.

• Diesel Price Reduction: Anticipated drop of Rs 7.37 per litre.

• Global Oil Trends: Brent crude oil prices have fallen to approximately $66.60 per barrel.

• Government's Role: Adjustments are influenced by international market dynamics and domestic fiscal policies.

The international oil market has witnessed a downward trajectory in recent weeks. Brent crude, a global benchmark, has declined to around $66.60 per barrel, while West Texas Intermediate (WTI) stands at approximately $62.85 per barrel. Factors contributing to this decline include increased production by OPEC+ countries and easing geopolitical tensions, notably a potential ceasefire in the Russia-Ukraine conflict.

The World Bank's latest Commodity Markets Outlook forecasts a significant decline in global commodity prices over the next two years due to weakening global growth and rising trade barriers. Prices are expected to drop 12% in 2025 and a further 5% in 2026, returning to pre-COVID-19 levels observed from 2015 to 2019.

Based on current international trends and domestic fiscal considerations, the following changes are expected in Pakistan's fuel prices starting May 1, 2025:​

• Petrol: Reduction of Rs 4.88 per litre.

• High-Speed Diesel (HSD): Decrease of Rs7.37 per litre.

• Kerosene Oil: Drop of Rs8.03 per litre.

• Light Diesel Oil (LDO): Cut of Rs5.37 per litre.​

These adjustments are calculated based on the current tax structure and international market prices.

While the decline in global oil prices typically translates to domestic relief, the Pakistani government's recent decision to remove the cap on the petroleum levy grants it the authority to adjust the levy at will. This move allows for greater flexibility in managing fiscal policies but also introduces uncertainty regarding the extent of relief passed on to consumers.

Consumer Relief

The anticipated reduction in fuel prices is expected to alleviate some financial pressure on consumers, particularly in the transportation and agriculture sectors, where fuel constitutes a significant portion of operational costs.​

Inflationary Trends

Lower fuel prices can contribute to a decrease in transportation costs, potentially leading to reduced prices for goods and services. This development may aid in curbing inflation, which has been a persistent challenge for the Pakistani economy.​ 

The global oil market remains volatile, influenced by geopolitical developments, production decisions by major oil-producing nations, and shifts in global demand. While current trends suggest a continued decline in oil prices, unforeseen events could alter this trajectory.​

Domestically, the government's approach to managing the petroleum levy and other fiscal tools will play a crucial role in determining the extent of relief experienced by consumers. Continuous monitoring of international markets and proactive policy adjustments will be essential in navigating the challenges and opportunities presented by fluctuating oil prices.

The expected decrease in petrol and diesel prices from May 1, 2025, offers a glimmer of hope for Pakistani consumers grappling with economic challenges. As global oil prices decline, the government's fiscal strategies and responsiveness to market dynamics will be pivotal in translating international trends into tangible domestic benefits.