Pakistan likely to cut oil prices as PM directs pass-through of global fall
- International oil prices have declined by over 30% in the last 30 days
Oil prices in Pakistan are expected to decline significantly after Prime Minister Shehbaz Sharif directed authorities to immediately pass on the benefit of falling international crude prices to consumers, prompting the government to form a high-level committee to develop a transparent weekly mechanism for determining petroleum product prices, Petroleum Minister Ali Pervaiz Malik said on Thursday.
Federal Minister for Petroleum Ali Pervaiz Malik said in a statement on X that the diplomatic efforts of the government are bearing fruit and Iran and the US are moving towards a ceasefire agreement, the positive effects of which have also started becoming evident in global energy markets.
The US and Iran released the text of an interim agreement on Wednesday that would end the Iran war, reopen the Strait of Hormuz and waive US sanctions on Tehran’s oil, resolving the largest energy supply disruption in history.
Following the development, oil prices fell in early trading on Thursday. Brent crude futures were down 89 cents, or 1.12%, at $78.66 a barrel as of 0005 GMT, and US West Texas Intermediate fell 98 cents, or 1.28%, to $75.81 a barrel.
International oil prices have declined by over 30% in the last 30 days.
In a statement, the government said oil prices are falling in the international market, and PM Shehbaz directed that the benefit of this reduction be passed on to the public immediately. For this purpose, the government has formed a high-level committee that will devise a transparent weekly formula for determining petroleum product prices.
Malik said that under the transparent formula, the public will be fully informed about the reasons for price changes, and the process of price determination will be made more transparent in the future. He said that this formula will be finalised after consultation with all relevant stakeholders.
The federal minister said that despite tensions in the region, the government has responsibly maintained the country’s oil supply chain without any major disruption.
He further stated that in view of the current regional situation, the government is also reviewing its energy security strategy and several measures will be introduced in the coming months to safeguard national interests and ensure a secure energy future.