Diesel price up by PKR 11, petrol unchanged as Pakistan govt revises prices

Pakistan has kept unchanged the price of petrol while the price of diesel has been increased for the next two weeks.

A Finance Ministry notification issued on Saturday said the price of petrol will remain PKR 253.17 per liter. The price of diesel has increased by PKR 11.3 per liter from PKR 257.08 to PKR 268.38.

The government revises the prices of petroleum products every fortnight in line with changes in global oil prices.

The prices will take effect from Sunday.

On January 15, Pakistan kept the price of petrol and diesel unchanged in contrast to the expectation of a rate cut due to lower global oil prices.

The government has declined to pass on the benefit of falling international oil prices to consumers and industry, instead increasing fuel taxes to boost revenues while keeping retail prices unchanged.

Fuel prices in Pakistan are influenced not only by global crude prices but also by the government’s tax structure, particularly the Petroleum Development Levy (PDL).

The PDL is a fixed amount per liter levied on petroleum products. It is a key source of non-tax revenue for the federal government because, unlike the general sales tax, which must be shared with provinces under the National Finance Commission Award, the petroleum levy remains entirely in the hands of the federal government.

As part of commitments made under the International Monetary Fund program, Pakistan has gradually increased the levy on petrol and diesel in recent months.

The government can impose a maximum PDL of PKR 90 per liter on petrol and diesel under the Finance Act 2025. Currently, the levy on petrol and High Octane Blending Component (HOBC) is PKR 84.27 per liter, while that on high-speed diesel PKR 76.21.

Consumers of kerosene and light diesel oil are also subject to petroleum levies of PKR 20.36 and PKR 15.84 per liter, respectively.

In addition to the PDL, the government continues to collect a Climate Support Levy of PKR 2.50 per liter on petrol, high-speed diesel and HOBC.

The taxation essentially means that even when global oil prices fall, domestic price reductions may be limited if the government chooses to maintain or increase the levy to meet fiscal targets.

Fuel prices are further affected by the Inland Freight Equalization Margin, which stands at PKR 8.97 per liter for petrol and PKR 7.25 per liter for high-speed diesel, aimed at ensuring uniform prices across the country.