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A Hefty Cut in Fuel Prices in The Offing (Relief for Consumers)

Posted by on Monday, October 27, 2014, 11:17
This news item was posted in Business category and has 0 Comments so far .

Pakistani consumers should expect a hefty cut in fuel prices as global oil prices continue to plummet following a boom in US shale oil production.

Fuel Prices

Fuel Prices

A decrease of up to Rs8 per litre is likely to come into effect next month, The Express Tribune has learnt. This will allow consumers to enjoy lower fuel prices for the third consecutive month. In October, the government had slashed the prices by 2.8% after oil prices dipped in the international market.

With the global oil markets buoyed by a glut of crude oil coming out of the US shale reservoirs, the downward trend seen in the value of crude oil is likely to continue.

โ€œIn the short term, the decline in oil prices would continue as OPEC would meet after a month to decide whether or not to slash production to avoid further decline in oil prices,โ€ a senior government official said commenting on the trend. He added that OPEC had been cutting oil production to maintain the prices, which have been hovering around the $85 per barrel mark.

The official said the average crude oil price in Pakistan would stand at $85 per barrel and its impact would be passed on to consumers.

Following the expected cuts next month, the price of High Speed Diesel (HSD), which is widely used in heavy transport vehicles and the agriculture sector, is likely to come down by Rs5.50 per litre. Currently, it is sold at Rs107.39 per litre.

Similarly, the petrol price could witness a cut of Rs5.25 per litre against its current price of Rs103.62 per litre. Kerosene oil, which is used as kitchen fuel in remote areas of the country, may record a decrease of Rs5.50 per litre.

Consumers of High Octane Blending Component (HOBC), used mainly in luxury vehicles, are likely to enjoy a reduction of Rs8 per litre against the current price of Rs131.13 per litre.

Likewise, the price of light diesel oil, consumed mainly by industrial units, may also be reduced by Rs5 per litre. Currently, it is available at Rs91.41 per litre. โ€œThis trend may change and the final calculation would be made on October 30,โ€ the official further said.

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