Big Relief for Diesel Users as Prices May Fall
News Desk
Islamabad: Diesel consumers could soon see a major reduction in fuel costs, with Petroleum Minister Ali Pervez Malik saying the price of diesel is expected to decline by more than Rs30 per litre after local refineries agreed to lower their rates.
The expected reduction comes as the government seeks to shield consumers from the impact of rising international petroleum prices amid the ongoing war and global energy market disruptions.
Speaking at a press conference alongside Information Minister Attaullah Tarar, Ali said the final price would be determined after the Oil and Gas Regulatory Authority completes its calculations.
The minister said the government had asked local refineries to reduce their prices after international petroleum costs surged, with the diesel crack margin reaching between $60 and $70.
According to Ali, Prime Minister Shehbaz Sharif personally approached the refineries and urged them to help reduce the financial pressure on consumers. The refineries subsequently agreed to a significant reduction.
The move is expected to have a broader impact beyond motorists. Ali said cheaper diesel would particularly benefit farmers who rely on tractors and tube-wells, while students and other commuters using buses could also see indirect relief.
The government has pledged that the reduction agreed with refineries will be fully passed on to consumers, while attempting to balance lower fuel prices with the financial needs of companies operating across the petroleum supply chain.
Ali said the government had already spent more than Rs100 billion to cushion people from the economic impact of the ongoing crisis despite operating under the International Monetary Fund programme. Targeted subsidies have also been introduced in consultation with provincial governments.
However, the minister indicated that the government was also looking beyond an immediate reduction in fuel prices. He said structural weaknesses in Pakistan’s refining industry had contributed to higher energy costs and increased the country’s dependence on expensive crude imports.
Some local refineries, he explained, lack the capacity to process heavy crude oil, forcing Pakistan to rely more heavily on costly imported crude.
To address the issue, Ali said the government would develop a refinery-upgradation plan aimed at improving domestic processing capacity and reducing long-term energy vulnerabilities.
He also announced plans to operationalise bonded schemes that would allow Pakistan to procure and store crude oil from friendly countries according to demand.
The petroleum minister is scheduled to visit refineries in Karachi next week with his team on the prime minister’s instructions. The visit will focus on thanking refineries for their cooperation and discussing long-standing issues, including investment in refinery upgrades.
While the immediate focus remains on the expected diesel price cut, the government says the longer-term objective is to strengthen domestic refining capacity, reduce dependence on costly imports and improve Pakistan’s energy security.
