Prices of petroleum products in Pakistan are expected to rise by up to Rs9.59 a litre from March 1, 2022, as tensions in Europe rise following Russia’s invasion of Ukraine.
The government raised the price of petrol by Rs12.03 per litre to Rs159.86 per litre in mid-February, setting a new record for price increases in petroleum goods.
In the international market on February 16, the price of crude oil was $94 per barrel. Oil prices topped $100 a barrel for the first time since 2014 as Russia started an attack on its neighbour, with Brent crude topping $105 on Thursday.
Since the start of the war, European countries and the United States have imposed harsh sanctions on Russia.
According to industry experts, Russia intends to increase its revenue from the oil market with the support of Ukrainian oil during the present post-Covid economic rebound.
They claim, however, that the US will try to limit Russia’s gains by taking strong measures to drive down world oil prices.
Although the United States has vast shale oil deposits, it is much more expensive than crude oil. Experts believe that Washington may try to flood the world market with shale oil in order to lower prices and reduce Russia’s earnings.
As an alternative, the United States will attempt to lift sanctions against Iran and reopen its oil market, lowering crude prices to $65 per barrel. They claim that if no other options are available and the current scenario persists, crude oil prices might rise to $125 per barrel on the worldwide market. “Such a trend could push local petroleum goods prices above Rs200 per litre,” an analyst said. Petrol prices could rise by Rs9.59 to Rs169.45 per litre.
At the moment, a gallon of petrol costs Rs159.86. In small cars and motorcycles, Pakistanis utilise petrol as an alternative to compressed natural gas (CNG). Because retail stores in Punjab use imported liquefied natural gas, consumers are forced to buy pricey CNG (LNG).
