Fuel consumers might have a major relief of Rs41 per litre in the price of diesel and Rs17.21 per litre in petrol following the reduction in global Fuel Rates.
However, the consumers would be able to fully avail this relief if the government passes on the entire reduction in global oil prices to them.
The people had faced four oil price shocks since this government came into power to fulfil its commitment to the International Monetary Fund (IMF).
Pakistan has been unable to revive the IMF loan programme so far because of the prices of electricity and petroleum products.
The estimates of oil marketing companies (OMCs) indicate that based on the current rates of petroleum levy, the ex-depot price of high-speed diesel (HSD) may come down by Rs41.78 per litre, petrol by Rs17.21, kerosene oil by Rs30.38 and light diesel oil (LDO) by Rs32.38.
This reduction would bring the price of HSD down from Rs276.54 to Rs234.76 per litre, petrol from Rs248.74 to Rs231.53, and kerosene oil from Rs230.26 to Rs199.88 and LDO from Rs226.15 to Rs199.77.
Finance Minister Miftah Ismail on Wednesday said the summary to reduce petroleum prices had been sent to Prime Minister Shehbaz Sharif for further action.
Talking to a private television channel, Miftah added that the prices of petroleum products would be reduced on the directives of the premier to provide relief to the people.
Miftah further maintained that the prime minister sincerely wanted to give the benefits of low petroleum prices in the international market to the people without any delay.
Earlier, PM Shehbaz directed the authorities to pass on the full benefits of the fall in oil prices in the global market to the people.
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Chairing a meeting on fuel prices, he said the people had spent a difficult time, and now they had the right to receive full relief.
At present, the petroleum levy on petrol stands at Rs10 per litre and Rs5 per litre on HSD, kerosene oil and LDO each. However, the sales tax on them is zero.
The National Assembly approved a rise in the maximum limit of the petroleum levy from Rs30 per litre to Rs50 per litre to achieve the budgetary target of Rs750 billion in the Finance Bill 2022-23.
Sources in the Petroleum Division told The Express Tribune that the government was unlikely to fetch Rs750 billion from the petroleum levy in the current financial year at the current rates as that would enable a maximum collection of Rs14 billion per month.
Additionally, a revenue shortfall of Rs45 billion per month would be experienced if the 17% general sales tax (GST) is not slapped on these products.
In the last 15 days, the international crude oil price dropped to below $94 per barrel from $104.09.
The international prices have come down a bit, Miftah said over the proposal to reduce the oil prices in the domestic market for the next 15 days with effect from July 16, 2022. The minister added that the proposed reduction would not affect the ongoing IMF parleys.
The PML-N-led coalition government has been increasing petroleum prices since the last week of May as it slashed fuel subsidies to unlock IMF funding.The prices of HSD, petrol, kerosene and LDO have skyrocketed by 92% (Rs132.39), 66% (or Rs99), 95% (Rs111.95) and 80% (Rs100.59) respectively since May 26, when the government introduced the first of a series of Fuel Rates hikes.