In a significant move aimed at providing relief to the transport and agriculture sectors, the federal government has announced a substantial reduction in the price of high-speed diesel (HSD). The new price, effective from midnight on May 1, 2024, sees a decrease of Rs14 per litre.
Official Notification and New Price Structure
The decision was formally communicated by the Finance Division through a late-night notification on Tuesday, April 30. According to the official release, the price of high-speed diesel (HSD) has been reduced from Rs290.38 to Rs276.21 per litre. This marks a notable drop for a fuel that is critically important for the country's freight transport, railways, and agricultural machinery.
In contrast, the price of petrol (motor spirit) will remain unchanged at Rs293.94 per litre. The government has decided to maintain the current petrol rate, foregoing any increase or decrease for the upcoming fortnight.
Rationale Behind the Pricing Decision
The fortnightly review of petroleum product prices is a standard procedure undertaken by the government, factoring in fluctuations in the international oil market and the exchange rate of the Pakistani rupee. The latest adjustment reflects a downward trend in global oil prices, particularly for diesel.
This targeted reduction is seen as a strategic measure to curb inflationary pressures. Diesel is a key input cost for the transportation of goods across the country. A lower diesel price is expected to reduce logistics costs, which can subsequently help in lowering the prices of essential commodities and goods for the general public.
Furthermore, the agriculture sector, which heavily relies on diesel to operate tube wells and harvesters, especially during the ongoing Kharif season, will benefit directly from this price cut. This could potentially lead to lower production costs for farmers.
Market Impact and Public Reaction
The announcement has been met with cautious optimism. Transport associations and logistics companies have welcomed the reduction, stating it will ease their operational burdens. However, consumers and industry bodies continue to call for more stable and long-term pricing policies to ensure predictability for businesses.
Analysts suggest that while the diesel price cut is a positive step, the unchanged petrol price means that the majority of private vehicle owners will not see immediate relief at the pump. The government's decision to keep petrol prices steady indicates a balancing act between providing targeted economic relief and managing its revenue collection from petroleum levies.
The new prices will remain in effect for the next two weeks, until May 15, 2024, after which the government will undertake another review based on the global market trends at that time.
