Acknowledgement

• First of all we are thankful to Almighty Allah who in spite of all our weaknesses enabled us for this type of project. We are also indebted to our teacher “Prof. Farooq Qaisar” for his kind of guidance and supervision.

Dedications

• We dedicate our first Business plan Project to Allah Almighty who has made it possible for us to work & then to our respected teacher “Prof. Farooq Qaisar” who provided us with all the guidelines to prove ourselves. We are grateful to them for giving us this opportunity to explore the most critical topic of Pakistan’s economy that is PETROLIUM. The impact of petroleum on Pakistan’s economy. We are indebted to them for giving us following opportunity which will help us in a long run. Insha Allah

Summary:

• We are studying about the Petroleum products & there affects on Pakistani economy. For this purpose we study the past projects researches and articles. After that we also conduct a survey on this topic results are totally different from our expectations. We conclude that there is not a big change in this economy from the fluctuation of petroleum and crude oil prices. Further more details are also in this are also in this article.

Group Members

Asma Tahir 2069

Iqra Rasheed 0068

Zobia Raffeque 2070

Impact of oil prices on Pakistan’s economy

IMPORTANCE

Petroleum plays a vital role to many industries, and is of importance to the maintenance of industrial civilization in its current configuration, and thus is a critical concern for many nations. Oil accounts for a large percentage of the world’s energy consumption, ranging from a low of 32% for Europe and Asia, to a high of 53% for the Middle East.

In Pakistan most of industries are dependent on petroleum and its product.

like wapda, medium and large scale industries & Transprotation

Literature reviewImpact of oil International prices on Pakistan economy

Findings The data is collected from real international statistics, Pakistan economic survey and Energy year book. Real GDP is measured in millions.

• The real crude oil prices are taken in dollar per barrel.

Conclusion:

The topic to explore the relationship of sharp rises in the prices of oil with GP growth of Pakistan the period for the period of 20 years 1990 to 2009. A macroeconomic model is analyzing the purpose. Several prices can be a sharp rises in the prices of crude oil CO affect the output negatively, no matter the price of CO is less then or more then the critical review.

IMPACT OF OIL PRICES ON STOCK EXCHANGE AND CPI IN PAKISTAN

FindingsThe oil is one of the most important factors affecting the economy of the world so that the demand of oil increase day by day and its prices increase double as the demand.  

ConclusionMost of the countries focus the energy sector so that the oil one of the major sources for the energy sector so that the increase in oil prices and the demand of oil both increase very rapidly and the research result confirm that the increase in prices of oil effect the energy sector and it effect the stock market and oil prices have the positive and significant impact on the stock market.

Our Model

Independent

Foreign Crude oil prices

Our Currency rate

Dependent

Price

Imports

Moderating

Foreign debt burden

Government’s policies

Q 1: By decreasing oil prices what effect

on your consumption?

 

Q 2: What will be the future of textile industry in Pakistan?

Q3: Are the rents of public transport company decreased?

Q 4: Are the electricity prices also decreased on same ratio to oil?

Q 5: What do you think about the future of cottage industry on current crude oil price?

Q 6: There is less use of foreign reserves on imports of oil & petroleum . is this healthy sign for Pak economy?

Q 7: are the” common man” avail benefits from lower oil prices?

Gross Domestic Production

GDP (gross domestic product) is most important and one of the primary indicators utilized to measure the condition of any country's economy. The monetary worth of all the services and finished goods produced surrounded by a country's borders in a precise time period is called GDP. It is normally measured in annually basis.

GDP growth reaching 8.4 percent in 2004-05

The energy consumption It has grown at an annual average rate of 4.4 percent from 1990-91 to 2005-06

Imports and its cost

The oil being the second major resource of power utilized along by means of approximately a stable velocity of its production. Pakistan is seriously reliant on the oil imports from the Middle East exporters (Saudi Arab have a significant role). Approximately 82 percent of the oil and petroleum products demand in the country is meet through imports.

Pakistan expenditure almost 44 percent of its export income on oil imports in the year 2006 to 2007. This proportion was barely 27 percent in the year 2004 to 2005.

Petroleum & Inflation

Crude OilSome Facts

• A fall in the oil price will reduce the import bills of Pakistan, thereby improving the balance of payments, foreign reserves and, of course, the value of the rupee.

• Pakistan's first oil field was in the late 1952 in Baluchistan near a giant Sui gas field. The Toot oil field was not discovered in the early 1960s in the Punjab. It covers 122.67 square kilometers (47.36 sq mi). Pakistan Petroleum and Pakistan Oilfields explored and began drilling these fields with Soviet help in 1961 and activity began in Toot during 1964. Pakistan has more than 326 million barrels of oil the Senate was told on Wednesday 29 January 2009.

Respondents

Gulistan Textile Mills ( Managers)

Sapphire Textile Mills ( Managers)

Petrol Stations

Common Man

Oil Prices in Pakistan

Date HOBC Premium HS Diesel LS Diesel Kerosene

Jan 31, 2015 Rs.80.18/Ltr Rs.70.29/Ltr Rs.80.61/Ltr Rs.57.94/Ltr Rs.61.44/Ltr

Jan 01, 2015 Rs.92/Ltr Rs.78.28/Ltr Rs.86.23/Ltr Rs.67.5/Ltr Rs.71.92/Ltr

Dec 01, 2014 Rs.106.27/Ltr Rs.84.53/Ltr Rs.94.09/Ltr Rs.77.98/Ltr Rs.83.18/Ltr

Nov 01, 2014 Rs.116.45/Ltr Rs.94.19/Ltr Rs.101.21/Ltr Rs.83.42/Ltr Rs.87.52/Ltr

Oct 01, 2014 Rs.131.13/Ltr Rs.103.62/Ltr Rs.107.39/Ltr Rs.91.46/Ltr Rs.95.6/Ltr

Sep 01, 2014 Rs.129.64/Ltr Rs.106.56/Ltr Rs.108.34/Ltr Rs.92.08/Ltr Rs.97.05/Ltr

May 01, 2014 Rs.131.26/Ltr Rs.107.97/Ltr Rs.109.34/Ltr Rs.94.13/Ltr Rs.98.07/Ltr

Apr 01, 2014 Rs.136.57/Ltr Rs.108.31/Ltr Rs.113.85/Ltr Rs.95.06/Ltr Rs.101.15/Ltr

Petroleum Prices Archive

Main Finding

A fall in the oil price will reduce the import bills of Pakistan, thereby improving the balance of payments, foreign reserves and, of course, the value of the rupee

Conclusion

When the cost of oil goes up, production costs are increased and profits reduced for industries that depend on oil. Producer costs — not consumer gasoline costs — is the reason high oil prices threaten to shrink industrial production of goods directly affected and also of energy-intensive products such as aluminum and paper. This threat affects all new and old industrial economies, whether those nations import or export oil.

The fall in oil prices is good for the world’s economic recovery. Since most of the countries import oil, which makes their balance of payments unfavorable, a fall in the price of oil meant an improvement in the balance of payments and a rise in the currency rate. In the case of the US’s economy, a fall in oil prices implies higher incomes for US consumers. An increase in the consumers’ income, in turn, means increase in demand. This is true in the case of Europe as well, which has been experiencing economic recession since 2008. An increase in the aggregate demand means the pumping of the economy’s heart

Recommendations

• Of these many uses of oil in industry and commercial transportation, gasoline demand.

• Among ordinary consumers may be the least sensitive to price. That is why the

• Relatively invariable demand of motorists cannot possibly account for the wide cyclical variations we observe in crude prices. It’s the other 60 percent of the barrel that matters most, at the margin. Just as oil market pundits typically ignore the 60 percent of petroleum not going into passenger cars, they likewise ignores the 60 percent of incremental oil demand not coming from China and the United States.

• GDP (gross domestic product) is most important and one of the primary indicators utilized to measure the condition of any country's economy. The monetary worth of all the services and finished goods produced surrounded by a country's borders in a precise time period is called GDP. It is normally measured in annually basis.