Pakistan may hike fuel prices by up to PKR 7 per liter

Petroleum product prices in Pakistan are expected to rise by up to PKR 7 from March 1, according to officials in the country's oil marketing sector.

The government revises the prices of petroleum products every fortnight in line with changes in global oil prices. The next revision is due on February 28.

The estimates, updated as of February 24, suggest an increase of PKR 6.73 per liter for petrol (Motor Spirit) and PKR 6.13 per liter for high-speed diesel.

If the ex-refinery changes are passed on in full, petrol could climb to PKR 264.9 per liter from the current PKR 258.17 per liter, while high-speed diesel would rise to PKR 281.83 per liter from PKR 275.70 per liter.

The current prices have been in effect since February 16.

Preliminary calculations for the revision are being prepared, with the Oil and Gas Regulatory Authority (OGRA) expected to submit its recommendations to the government ahead of the announcement.

Following approval from Prime Minister Shehbaz Sharif, the Petroleum Division will formally notify the new prices, which will take effect for the first fortnight of March.

Petroleum development levy collection

Meanwhile, petroleum development levy (PDL) collections continue to surge.

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.

Revenue for the six months ending December 31 reached PKR 823 billion, up from PKR 372 billion in the first quarter and nearly 50% higher than the PKR 549 billion collected in the same period of the previous fiscal year.

Analysts estimate that net levy collections could surpass PKR 1,450 billion in FY 2026, up from PKR 1,220 billion in FY 2025.

Pakistan has also submitted a five-year petroleum levy collection plan to the International Monetary Fund, with projections showing collections rising steadily to PKR 2,212 billion by FY 2029-30.