ISLAMABAD, April 24: The federal government led by Prime Minister Shehbaz Sharif has increased petrol and high-speed diesel prices by up to Rs27 per litre, primarily driven by an enhanced petroleum levy rather than changes in global oil markets.
According to official notifications, the price of high-speed diesel has been increased to Rs380.2 per litre from Rs353.42, reflecting a 7.5% rise. Petrol prices have also been revised upward to Rs393.4 per litre from Rs366.6, marking an increase of 7.3%.
Officials from the Petroleum Division confirmed that international oil prices remained largely stable, and the upward revision in domestic fuel rates was mainly due to adjustments in taxation, particularly the petroleum levy.
The government has set the petroleum levy on petrol at Rs107.4 per litre, effectively shifting a greater tax burden onto petrol consumers. Sources indicate that this approach follows fiscal recommendations linked to ongoing negotiations with the International Monetary Fund, which has reportedly urged Pakistan to maintain or increase revenue collection from fuel taxation.
The IMF-backed $7 billion bailout programme continues to influence fiscal policy, with the government having already collected over Rs1.2 trillion in petroleum levy during the first nine months of the current fiscal year—around 82% of its annual target.
Officials say further adjustments are still under consideration, including an additional Rs53 per litre tax requirement that may be distributed between petrol and diesel in the coming weeks.
High-speed diesel remains one of the most inflation-sensitive fuels due to its extensive use in transportation and agriculture. Despite the latest increase, its price is still below earlier peak levels recorded earlier in the year.
The government has previously altered petroleum levy rates multiple times, at one point raising them to record highs before partially reducing them following public criticism. However, the current revision signals a return to heavier reliance on fuel taxation to meet fiscal targets.
Economic analysts warn that the decision is likely to add pressure on inflation, particularly affecting transport costs and essential goods pricing. Diesel already carries a significant tax load, including customs duties and climate-related levies, while petrol remains heavily taxed across multiple categories.
At the same time, prices of kerosene oil and light diesel oil have been reduced in line with global market trends, offering limited relief to some consumers. Kerosene has been reduced by Rs63.6 per litre, while light diesel oil has seen a cut of Rs29 per litre.
The government continues to balance fiscal requirements under IMF conditions with domestic inflation concerns. The next review of the bailout programme is expected in early May, where further policy measures, including fuel taxation adjustments, may be discussed.
