PM Shehbaz Cuts Petrol Price by Rs6.17, Diesel by Rs 10.86

Prime Minister Shehbaz Sharif has approved a new reduction in fuel prices effective from Wednesday. Here are the details:

1. Price Cuts:
   • Petrol: The price will drop by Rs6.17 per liter.
   • High-Speed Diesel (HSD): The price will be reduced by Rs10.86 per liter.
   • Kerosene Oil: Price will fall by Rs6.32 per liter, making the new price Rs 177.39.
   • Light Diesel Oil: Price will be cut by Rs5.72 per liter, bringing it to Rs 160.53.
2. New Prices:
   • Petrol: Rs269.43 per liter.
   • High-Speed Diesel: Rs 272.77 per liter.
3. Background:
   • The price cuts are larger than expected. Originally, it was estimated that petrol would drop by about Rs3 and HSD by Rs8.50 per liter due to lower international oil prices and reduced import costs.
   • Recently, international oil prices for petrol fell from $89.5 to $87.5 per barrel, and HSD prices dropped from $96.93 to $94 per barrel. This decrease contributed to the reduction in local prices.
4. Other Factors:
   • The import premium (extra cost added to the base oil price) for both petrol and HSD decreased. For petrol, it dropped to $8.8 from $9 per barrel, and for HSD, it fell to $5 from $6.5 per barrel.
   • The exchange rate remained stable during this period.
5. Historical Context:
   • Prices of petrol and HSD were recently increased significantly. On June 30 and July 16, petrol and diesel prices went up by Rs7.45 and Rs9.99, and Rs9.56 and Rs6.18, respectively. This resulted in a total increase of Rs17.44 for petrol and Rs15.74 for diesel over the past month.
   • Earlier, between May 1 and June 15, prices had been reduced by approximately Rs35 for petrol and Rs22 for HSD.
6. Government Revenue:
   • The government has increased the maximum petroleum levy to Rs70 per liter in the current Finance Bill to raise more revenue. The target is to collect Rs1.28 trillion in the next fiscal year, up from Rs960 billion collected last year.
7. Taxes:
   • The government charges about Rs78 per liter in taxes on both petrol and HSD. This includes a Rs60 per liter petroleum development levy, although GST is currently zero on petroleum products.

These changes are intended to reflect lower international oil prices and help manage local fuel costs.

McDonald’s sales are dropping around the world