by ZeeShan Kahloon 
Finance Minister Miftah Ismail announced the decision in an unexpected press conference after Prime Minister Shehbaz Sharif approved it at a party meeting.
You may be thinking who is in charge of regulating the oil and gas business in Pakistan and recommending petroleum product pricing. Read on to know the answer.
Petroleum and Its Products: An Overview
Petroleum is a naturally occurring liquid under the earth’s surface. The hue of petroleum varies from yellow to blackish. Petroleum is derived from the combination of two words, ‘petra’ (rock) and ‘oleum’ (oil), which gives petroleum its alternate moniker of ‘fossil fuel.’
It is thought to be found in geological formations under the earth’s surface. The drilling process obtains raw petroleum from beneath the earth, and distillation is used. Distillation separates liquid petroleum from raw petroleum produced by drilling.
When dead creatures such as algae and zooplankton are buried deep beneath the earth and exposed to extreme heat and pressure, they transform into petroleum. Petroleum is just crude oil, although it may contain numerous liquids, solids, and gaseous hydrocarbons in its unprocessed form.
Petroleum Types Sold in Pakistan
Petroleum is distilled into a variety of fuels. The following are the types of petroleum that Pakistan requires.
Premium (Super)
It is a popular kind of gasoline in Pakistan, mostly used in motorbikes and automobiles. As a result, there is a high demand for Premium (Super) gasoline in Pakistan.
High Speed Diesel
In Pakistan, it is used as a commercial vehicle fuel. These are the cars with the horsepower to exceed 750 RPM.
Low Speed Diesel
It is used as a fuel in medium-speed engines. These are generally off-road vehicles and equipment with higher power than passenger automobiles.
Kerosene
In Pakistan, it is a popular petroleum item used to ignite a fire. It is also utilized to power tiny machines and machinery.
Liquefied Petroleum Gas (LPG)
Pakistan imports LNG, which is used to power automobiles and meet domestic natural gas demands.
A Quick Background of Pakistani Petrol Prices
The worldwide petroleum business was severely harmed by the coronavirus outbreak. The global demand for fuel fell dramatically, leaving the oil and gas industry oversupplied. Fuel usage in Pakistan fell by 11% during the June-July fiscal year 2020-2021 due to stringent lockdowns and the fear of contracting COVID-19, which kept most people indoors.
The business sector has declared many forms of work-from-home policies. Petroleum products in Pakistan were at their lowest costs in 10 to 12 years. In June 2021, the price of gasoline in Pakistan rose to PKR 108 per liter. In addition, as a result of the severe lockdown measures, several sections of the country have begun to report gasoline shortages.
These crises, however, were brief. The number of coronavirus infections decreased in the later half of 2021, and the government moved its attention from stringent lockdown measures to smarter, more sustainable lockdown regulations.
Large-scale industry and commercial companies were permitted to restart operations while adhering to COVID-19 SOPs. The consequences are roughly the same in other nations. Petroleum prices are projected to climb higher in the coming months as demand for gasoline rises again.
The Most Recent Petrol Price in Pakistan in May 2022
The finance division of the ministry of finance announced higher petroleum product pricing on Thursday, effective May 27, 2022, after a Rs30 per liter increase on all petroleum products.
Keep checking back to remain up to speed on the country’s altering petroleum product prices. With the new rise, the new price of fuel will be Rs209.86 a liter, the highest ever rate and a 20% increase over current pricing.
Let’s take a look at the most recent fuel prices in Pakistan. The chart below depicts the current pricing of the most widely accessible petroleum by-products in the country, including gasoline, diesel, light diesel, and kerosene oil.
- Petrol prices have risen from Rs179.86 to Rs209.86 per liter.
- The price of high-speed diesel (HSD) has risen from Rs174.15 to Rs204.15 per liter.
- The price of kerosene oil has been raised from Rs155.56 to Rs181.94 per liter.
- The price of light diesel oil has risen from Rs148.31 to Rs 178.31 per liter.
The Most Recent CNG Price in Pakistan in May 2022
Compressed Natural Gas (CNG) is another common car fuel in the United States. For CNG supply, Pakistan is separated into two regions: Area I (Khyber Pakhtunkhwa, Balochistan, Potohar region comprising Islamabad, Rawalpindi, and Gujar Khan) and Region II (Sindh and lowlands of Punjab).
Natural gas fuel prices may differ from one place to the next. The most recent CNG pricing in Pakistan in both of these regions are provided below for your convenience. Examine it out!
- May 2022 CNG Price in Pakistan (Region I): PKR 145 per KG
- May 2022 CNG Price in Pakistan (Region II): PKR 195 per KG
The Possible Reason Behind the Price Hike
Finance Minister Miftah Ismail declared that all petroleum products will be raised in order to meet the International Monetary Fund’s (IMF) demand for the continuance of the bailout program. After meeting the IMF’s requirement, Pakistan would receive a $1 billion tranche under the Extended Fund Facility (EFF).
According to a news statement from the finance division, sustaining current petroleum product prices at current subsidized rates consistently increases the government’s twin deficit while also posing a significant risk to the energy supply chain.
Also, Oil Marketing Companies (OMCs) and refineries are having difficulty receiving international bank confirmation for LCs/SBLCs, as well as issues in acquiring insurance coverage for particularly high-priced cargos.
The government has decided to amend the present petroleum product pricing in order to rationalize the costs of petroleum products.
Who’s In charge Of Regulating Oil and Gas in Pakistan
The OGRA has sole authority to issue licenses for regulated operations in the natural gas, compressed natural gas (CNG), liquefied petroleum gas (LPG), liquefied natural gas (LNG), and oil sectors.
These activities include pipeline construction, transmission and distribution network development, natural gas sale and storage, installation, production, storage, transportation, and marketing of CNG, LPG, and LNG, pipeline laying, refinery establishment/operation, storage construction/operation, lube oil blending plants, and petroleum product marketing in the oil sector.
Some of the specific major roles are as follows:
- Natural gas utilities’ revenue requirements and prescribed prices are determined, and prescribed and consumer selling prices are notified.
- Calculates and communicates the ex-refinery price of SKO, as well as the ex-depot prices of SKO and E-10, and the Inland Freight Equalization Margin (IFEM) for all goods.
- Under the deregulated environment, keep an eye on the pricing of petroleum products.
- Technical standards and specifications (best international practices) are enforced in all regulated operations.
- Public complaints and disputes against licensees and between licensees are resolved.
How Does Pakistan’s Government Determine the Price of Petroleum?
The Oil and Gas Regulatory Authority determines the price of fuel in Pakistan today and tomorrow (OGRA). The price of fuel in Pakistan tomorrow is determined by a variety of variables, one of which is supply. OPEC’s reduced supply to other nations raises local prices as well.
Increased distribution and marketing costs have a significant influence on petrol prices, as retail dealers add their profit to the total cost of fuel. Added federal and state taxes raise gasoline costs even more.
Conclusion
You may see the fuel price in Pakistan today 2022 and the diesel price in Pakistan today 2022 at Globe Estate. Or you can simply know the petrol price in Pakistan tomorrow and estimate how much money you will need to pay to refuel your vehicle.
