Corrected Guide: Types of Petroleum Fuels in Pakistan

Petroleum, commonly called crude oil, is a naturally occurring liquid found beneath the Earth’s surface. It forms over millions of years from the decomposition of organic matter under heat and pressure. Crude oil is processed in refineries to produce different types of fuels used in transportation, industry, and households.

Below are the major petroleum-based fuels used in Pakistan.

1. Petrol (Super)

Petrol, also called Motor Spirit (MS) or Super Petrol, is the most widely used fuel for cars, motorcycles, and small vehicles.

• It has a higher octane rating (RON 92 in Pakistan) which improves engine performance.

• Suitable for spark-ignition engines.

Approximate Price:

Around PKR 266 per liter (prices change every 15 days).

2. High-Speed Diesel (HSD)

High-Speed Diesel is used primarily in heavy vehicles and industrial machinery.

Used in:

• Trucks

• Buses

• Tractors

• Construction machinery

• Diesel cars

It provides high torque and fuel efficiency for heavy-duty engines.

Approximate Price:

Around PKR 280 per liter.

⚠️ Note: The statement about “7500 RPM” is incorrect. Diesel engines usually operate at lower RPM but higher torque.

3. Light Diesel Oil (LDO)

Light Diesel Oil is mainly used in:

• Industrial machinery

• Boilers

• Small industrial plants

It is not commonly used in road vehicles.

Approximate Price:

Around PKR 155 per liter.

4. Kerosene Oil

Kerosene is used mainly for:

• Cooking stoves in rural areas

• Lamps

• Small engines

• Aviation (in refined form as jet fuel)

Approximate Price:

Around PKR 171 per liter.

5. Liquefied Petroleum Gas (LPG)

LPG is a mixture of propane and butane gases stored under pressure in liquid form.

Common uses:

• Domestic cooking gas cylinders

• Commercial kitchens

• Vehicle fuel in some areas

Approximate Price:

Around PKR 250–260 per kg.

⚠️ Correction: LPG is not derived from LNG.

It is produced during oil refining or natural gas processing.

6. Compressed Natural Gas (CNG)

CNG is natural gas (mostly methane) compressed to very high pressure for use as vehicle fuel.

Key features:

• Cleaner than petrol or diesel

• Lower emissions

• Previously very popular in Pakistan

Pressure level:

3000–3600 PSI

7. Hi-Octane Petrol

Hi-Octane fuel has higher octane levels (RON 95–97).

Benefits:

• Better combustion

• Higher engine efficiency

• Used in high-performance vehicles

Important note:

OGRA does NOT regulate Hi-Octane prices, so prices vary by petrol pump.

Euro Fuel Standards in Pakistan

Pakistan currently uses Euro-V fuel standards, introduced in 2020.

Before that:

Year Standard

2012 Euro II

2020 Euro V

Pakistan skipped Euro III and Euro IV to reduce emissions and improve fuel quality.

Many developed countries already follow Euro VI standards.

How Petrol Prices Are Determined in Pakistan

Petrol prices are influenced by several factors:

1. International Crude Oil Prices

Global oil prices directly affect Pakistan because the country imports most of its petroleum products.

2. Exchange Rate

Crude oil is traded in US dollars.

If the Pakistani Rupee weakens, fuel prices increase.

3. Government Taxes

The government applies:

• Petroleum Development Levy (PDL)

• Sales tax

• Other margins

These significantly impact fuel prices.

4. Refining Costs

Crude oil must be processed into usable fuels in refineries.

5. Transportation and Distribution

Fuel must be transported from refineries to petrol pumps, increasing the final retail price.

How Often Petrol Prices Change in Pakistan

Fuel prices are updated twice every month.

Announcement dates:

• 15th of the month

• Last day of the month

The prices remain effective for 15 days.

Authority responsible:

Oil & Gas Regulatory Authority (OGRA)

Highest Petrol Price in Pakistan

The highest recorded petrol price in Pakistan was approximately:

PKR 331.38 per liter

on 16 September 2023.

Economic Impact of Petrol Prices

1. Inflation

Higher fuel prices increase:

• Transport costs

• Production costs

This leads to inflation.

2. Consumer Spending

When fuel prices rise, households spend more on transport and reduce spending in other areas.

3. Business Costs

Companies pass higher transport costs to customers through higher product prices.

4. Trade Balance

Since Pakistan imports oil, higher prices increase the import bill and pressure on foreign reserves.