Govt slashes petrol, diesel prices as global oil rates hit two-month lows

ISLAMABAD: The government on Tuesday announced a reduction of Rs8 per litre in the price of petrol and Rs7 per litre in high-speed diesel, bringing their new rates to Rs338 and Rs371, respectively, effective November 11.

According to the new prices notified by the Oil and Gas Regulatory Authority (OGRA), petrol will now cost Rs338 per litre against the previous rate of Rs346, while high-speed diesel will be available at Rs371 per litre, down from Rs378.

The reductions come amid a decline in international oil prices, with global crude benchmarks falling to their lowest levels in about two months as concerns over a further escalation of the US-Iran conflict eased.

Brent crude futures fell $1.93, or 2.1 per cent, to $90.64 per barrel on Tuesday, while US West Texas Intermediate (WTI) crude declined $1.44, or 1.7 per cent, to $85.41, according to Reuters.

Both benchmarks were on track for their lowest closing levels since August 28.

Oil prices had also registered a sharp decline on Monday, with Brent settling 5.85 per cent lower at $92.57 per barrel and WTI falling 4.38 per cent to $86.85.

Easing US-Iran tensions weigh on oil prices

International oil prices have come under pressure following US President Donald Trump’s remarks indicating that he was unlikely to order fresh military strikes against Iran while efforts to end the conflict continued.

US Secretary of State Marco Rubio also told Group of Seven (G7) allies that American economic sanctions and the naval blockade on Iranian ports were working, reducing the need for major military operations against Iran.

The prospect of easing tensions has helped calm concerns about prolonged disruptions to global energy supplies, particularly through the Strait of Hormuz, a strategic waterway that normally carries around one-fifth of the world’s oil.

However, risks to commercial shipping remain. Iran’s Revolutionary Guards on Tuesday claimed that two oil tankers had caught fire in the Strait of Hormuz following explosions, while the UAE’s state oil company ADNOC confirmed that one of its vessels had sustained damage in an attack inside the country’s territorial waters.

Despite the continuing security risks, expectations of reduced military escalation and a potential improvement in oil supplies have weighed on international prices.

Reuters also reported that the global oil market was showing signs of a possible supply surplus, with weaker demand and increased production from some OPEC members adding to downward pressure on prices.