The federal government has announced its decision to cut the petrol price up to Rs10 per litre for the next fortnight. The petrol will now be available at Rs214.80 per litre.

“The decrease in the prices of petroleum products is due to the last quarter of this fiscal year which started on October 1st and continues today on December 15th,” Finance Minister Ishaq Dar said while announcing the government’s decision on fuel rates on PTV.

The price of petrol has been slashed by Rs10 per litre, and the price of high-speed diesel has been reduced by Rs7.5 per litre.

After the reduction, diesel will now be available at Rs227.82 per litre, while kerosene oil will be available at Rs171.83 after a reduction of Rs10.

“The reduction in petroleum prices is a part of Prime Minister Shehbaz Sharif’s campaign to provide relief to the people and in this regard, the government is focusing its attention on providing relief to the people,” Dar said.

“The decrease in the prices of petroleum products is due to the last quarter of this fiscal year which started on October 1 and continues today on December 15”

Pakistan is struggling to meet its external financing obligations in the face of low foreign exchange reserves that barely covered a month of imports, and is also beset by decades-high inflation that has slowed down its economy.

It is not yet confirmed that the country would get petroleum products from Russia at discounted rates as Foreign Minister Bilawal Bhutto has negated what the state minister of petroleum said earlier this month after taking a trip to the energy-rich country.

“Up until now we actually haven’t received nor are we getting any oil from Russia,” Bilawal said when asked about a $60-per-barrel cap imposed by the Group of Seven states and the European Union on Russian seaborne oil over Russia’s war in Ukraine during a press conference at the United Nations. “As far as discounted rates, no one is giving discounted rates for oil these days. That’s not a reality. It is true that we’re actively pursuing ways and means to address the energy shortfalls and difficulties we’re facing in Pakistan.”

Minister of State for Petroleum Musadiq Malik last week announced that Russia would sell crude oil, petrol, and diesel to Pakistan, in principle, at discounted rates. Pakistan would try to finalise it for an agreement or an executive summary before the visit of the inter-governmental delegation of Russia in January, he had said and did not specify the price of the oil.

Earlier, Dar said that Washington agreed with his suggestion for buying fuel from Kremlin as they had “no issue with it”.

Oil rises, poised to end week higher despite economy concerns

Oil prices rose in early Asian trade on Friday after falling two per cent in the previous session on central bank interest rate hikes, and is poised to end the week higher after a series of positive oil demand forecasts, Reuters reported.

Brent crude futures rose 36 cents or 0.4pc to $81.57 per barrel by 0109 GMT. West Texas Intermediate futures rose 25 cents, or 0.3pc, to $76.36 per barrel.

Both benchmarks are poised to end the week more than 7% higher.

The market found support this week from International Energy Agency projections of Chinese oil demand recovering next year after a 2022 contraction to 400,000 barrels per day (bpd). The agency raised its 2023 oil demand growth estimate to 1.7 million bpd.

The Organisation of Petroleum Exporting Countries (Opec) on Tuesday stuck to its forecasts for global oil demand growth of 2.55m bpd this year and 2.25m bpd in 2023 after several downgrades, saying that while economic slowdown was “quite evident” there was potential upside such as from a relaxation of China’s zero-Covid policy.

In bearish demand news, the United States Federal Reserve indicated it will raise interest rates further next year, even as the economy slips toward a possible recession.

On Thursday, the Bank of England and the European Central Bank raised interest rates to fight inflation.

A stronger dollar makes oil more expensive for those using other currencies.

With additional input from Reuters