Petrol and diesel prices are likely to see a reduction of Rs1.42 to Rs3.32 per litre starting November 1, 2024, thanks to a drop in crude oil prices in the international market.
According to industrial and official sources cited by The News, petrol prices may decrease by Rs3.29 per litre, while high-speed diesel (HSD) could be reduced by Rs3.13 per litre, with the average international price of petrol falling to $76 per barrel from $77.5 per barrel.
However, if authorities decide to adjust the internal equalization freight margin (IEFM) of Rs2-3 per litre, petrol prices could increase by Re0.78 and HSD by Rs0.26 per litre. The government had maintained a negative IEFM for the current fortnight, from October 16, 2024, to keep POL prices lower, despite a rise in international prices during the previous fortnight.
Even with an IEFM adjustment, kerosene oil prices would still drop by Rs1.42, and light diesel oil (LDO) would decrease by Rs3.32 per litre. Previously, the government had cut the IEFM by Rs3.04 and Rs4.07 per litre for HSD and Mogas, respectively, leading to losses for oil marketing companies and refineries.
In a letter dated October 16, 2024, to the chairman of the Oil and Gas Regulatory Authority (OGRA), the Oil Companies Advisory Council (OCAC) noted that the government had strayed from its established pricing formula. To maintain lower prices starting October 16, 2024, the Customs Duty for HSD was reduced from Rs15.18 to Rs13.26 per litre.
