Potential adjustments in fuel prices, indicating a possible stability or slight decrease in petrol and diesel costs starting from June 1st.
Pakistan may witness a decrease in petrol and high-speed diesel prices, according to industrial and official sources. The pricing adjustments are pending the input of the finance ministry. However, kerosene oil prices could rise, with a potential increase of Rs0.30 per litre to Rs164.96, and the light diesel oil price may increase by Rs1.30 per litre.
These local changes are influenced by global oil prices, particularly Brent crude, which hovered around $64 per barrel this week. The US economy's contraction, OPEC+ talks, and geopolitical factors impact Brent crude prices worldwide.
Scheduled discussions among OPEC+ members may lead to an increase in oil output, potentially causing downward pressure on Brent crude prices. In this scenario, lower import costs for Pakistan could result in reduced petrol and diesel prices domestically. However, local petrol and diesel prices are also influenced by exchange rate movements, government taxation policies, and domestic supply chain dynamics.
In the international market, Brent crude oil prices ranged between $64.02 and $64.60 per barrel. This weekly movement comes after a trade court blocked certain US tariffs, leading to a crude oil price rally, but the expectation of higher production volumes from OPEC+ has since overshadowed this positive sentiment. Conversely, data showing a contraction in the US economy further pressured the commodity.
A potential increase in oil output from OPEC+, due to scheduled discussions, might reduce Brent crude prices, subsequently lowering import costs for Pakistan and potentially decreasing domestic petrol and diesel prices. However, the finance industry may need to consider global finance news such as geopolitical factors, OPEC+ talks, and changes in Brent crude prices when making decisions about the pricing of energy products within Pakistan.
