Fuel prices in Pakistan are projected to decrease by up to Rs10 per litre for the upcoming fortnight ending April 30, driven by a reduction in international oil prices.
However, this expected relief hinges on the government maintaining current tax rates. An official source indicated that while price cuts are likely, authorities may consider limiting the reduction to avoid triggering excessive demand. Meanwhile, local oil refineries are pressing the government to reintroduce general sales tax (GST) on petroleum products.
The government has also committed to the International Monetary Fund (IMF) to introduce a carbon levy of approximately Rs5 per litre starting from July 1, as part of a $1.3 billion Resilience and Sustainability Facility agreement.
With existing tax structures in place, estimates suggest the ex-depot price of petrol could fall by around Rs10 per litre after the final review on April 15. High-speed diesel (HSD) may see a reduction of approximately Rs9 per litre.
These projections are based on a decline of nearly $6 per barrel in global petrol prices and around $5 per barrel for diesel over the past two weeks.
Currently, the ex-depot price of petrol stands at Rs254.63 per litre, while HSD is priced at Rs258.64 per litre.
The government is presently collecting around Rs86 per litre in taxes on both petrol and diesel. While GST remains zero on all petroleum products, a petroleum development levy of Rs70 per litre is being charged on petrol, diesel, and high-octane fuel — costs that are often borne by end consumers.
Additionally, there is a customs duty of Rs16 per litre on petrol and diesel, regardless of whether they are produced locally or imported. Oil companies and fuel dealers also receive approximately Rs17 per litre as part of distribution and sales margins.
