Govt increases petrol by Rs1.85, diesel by Rs1.75 for Oct 29

Read:Govt cuts petrol by Rs3.19, increases diesel by Rs2.25 for Oct 28On July 17, the government announced a new pricing mechanism under which petroleum product prices would be reviewed and notified daily, replacing the weekly pricing mechanism, as renewed tensions between the United States and Iran continued to drive volatility in global oil markets and raise concerns over fuel supplies.

On September 13, PM Shehbazannounceda special relief scheme offering Rs100 per litre off petrol for motorcycles, three-wheeler rickshaws and cars with engines up to 800cc, in an attempt to shield lower-income consumers from the impact of rising petroleum prices. Under the proposal, an estimated 11.8 million beneficiaries would be covered.

Around 10 million two-wheeler users and 800,000 three-wheeler users would be entitled to relief on 20 litres of fuel per month, translating into a maximum monthly benefit of Rs2,000 per beneficiary. Another one million users of cars up to 800cc would receive relief on 30 litres per month, providing them with a maximum benefit of Rs3,000 each.

On Sept 17, the government reintroduced austerity and fuel conservation measures amid rising fuel prices, tightening business operating hours and restricting public events. Under the measures, notified with immediate effect, shops, markets, shopping malls, bazaars, departmental stores, grocery stores, general stores and kiryana shops would close by 9pm throughout the week, the Cabinet Division.

Marriage halls, marquees and other commercial venues hosting festive events would close by 10pm, while restaurants, cafes, eateries, food outlets and standalone fruit and vegetable shops would be allowed to operate until 11pm. Takeaway and home delivery services would remain exempt from the timing restrictions. Global geopolitical developments continue to pose significant risks.

International oil prices are influenced by decisions taken by OPEC+, conflicts in the Middle East, sanctions on oil-producing nations, and disruptions in critical shipping routes such as the Strait of Hormuz and the Red Sea. Any interruption in these supply chains can immediately increase crude oil prices and freight costs.

Since Pakistan imports the majority of its petroleum requirements, these developments quickly translate into higher domestic fuel prices. Oil prices climbed about 2% on ‌Wednesday as continued fighting in Yemen and an attack on a refinery in Saudi Arabia renewed concerns about additional supply disruptions from the Middle East.

Brent futures rose $1.81, or 1.6%, to $115.69 per barrel at 10:42 am EDT (1442 GMT), while US West Texas Intermediate crude rose $2.52, or 2.5%, to $102.42.

"Crude ​futures once again pricing in nearer term tighter supplies on news the US is likely to re-start military operations soon, which could be more intense than in ​the past given the latest attacks on Saudi Arabia and other Middle East allies," Dennis Kissler, senior vice president of trading at US financial services firm BOK Financial, said in a note.