Declining Petroleum Prices Forecasted: What It Means for Consumers

declining petroleum prices forecasted what it means for consumersImage credit: Aaliyan Abbas

Starting May 16, petroleum product prices are expected to decrease further, providing relief to consumers. Petrol prices are anticipated to drop by Rs 12 per litre, aligning with a global trend of falling gasoline prices. Globally, gasoline prices have seen a decline of 6.32 dollars per barrel, reaching around $99.93 per barrel. Similarly, diesel prices are projected to decrease by Rs 9.70 per litre, reflecting the global decrease to $99.08 per barrel.

Over the first 10 months of the current financial year, the country has witnessed an 11% annual decline in petroleum product sales. According to OCAC and Topline Securities, sales from July 2023 to April 2024 totaled 12,443,000 metric tons, marking an 11% decrease compared to the previous year’s sales of 13,970,000 metric tons.

In April alone, the country recorded sales of 1,104,000 metric tons of petroleum products, showing a 6% decrease compared to April last year and a 4% decrease compared to March.

Gasoline sales for the first 10 months of this fiscal year amounted to 5,831,000 metric tons, marking a 6% decline from the previous year’s sales of 6,173,000 metric tons. Similarly, sales of high-speed diesel totaled 5,050,000 metric tons, 4% less than the same period in the previous fiscal year.

The data also reveals a significant decline in furnace oil sales, with only 869,000 metric tons sold in the first 10 months of the current financial year, a 53% decrease compared to the previous year’s sales of 1,866,000 metric tons. Other petroleum product sales totaled 693,000 metric tons during the same period.

These figures underscore the impact of both global and domestic factors on petroleum product prices and sales. It emphasizes the importance of monitoring trends to understand market fluctuations and their ramifications on the economy.

My Opinion:

It’s encouraging to see the anticipated drop in petroleum prices, which could alleviate some financial burden on consumers. However, the significant decline in sales raises concerns about the broader economic landscape and highlights the need for strategic measures to stabilize the market and stimulate growth.