Govt Raises Petrol, Diesel Prices by Rs26.77 per Litre Amid IMF Commitments
By Shahzad Paracha :
The government led by Shehbaz Sharif has sharply increased fuel prices, raising both petrol and diesel rates by Rs26.77 per litre with immediate effect for the week ending May 1.
According to the notification, the ex-depot price of petrol has climbed to Rs393.35 per litre from Rs366.58, while high-speed diesel (HSD) now costs Rs380.19 per litre, up from Rs353.42. The increase comes despite earlier estimates suggesting a potential reduction in prices based on global trends.
Officials say the move reflects a partial restoration of the petroleum levy and broader fiscal adjustments linked to Pakistan’s commitments with the International Monetary Fund. The IMF’s executive board is expected to consider the release of over $1.2 billion in funding under ongoing programmes in early May.
The price hike was announced quietly by the petroleum division, coinciding with high-level diplomatic activity in Islamabad involving negotiations between the United States and Iran.
Fuel prices have remained volatile in recent weeks, largely due to geopolitical tensions following the US-Israel strikes on Iran February 2026, which disrupted global energy markets.
Petroleum Minister Ali Pervez Malik said the government had tried to absorb rising international oil costs for as long as possible but was now compelled to pass on the burden to consumers. He described earlier reductions as “historic relief” provided within limited fiscal space.
With the latest revision, the government is collecting around Rs135 per litre in taxes on petrol and about Rs65 per litre on diesel, including petroleum levy and other charges. Notably, the levy on petrol has been increased significantly, while diesel remains exempt from levy at the retail level under the current adjustment.
Diesel, widely used in transport and agriculture, is considered particularly inflationary, meaning the increase could have a broader impact on prices of goods and services across the country.
Fuel remains one of the government’s largest revenue sources, with combined monthly sales of petrol and diesel reaching up to 800,000 tonnes, making pricing decisions both economically and politically significant.
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