Government Raises Petrol, Diesel Prices Again

The Federal Government has revised petroleum product prices upward for the fortnight ending February 28, 2026, pursuant to a late-night notification issued by the Petroleum Division. The adjustment increases petrol by Rs5 per litre and high-speed diesel (HSD) by Rs7.32 per litre.

According to the notification, the revision reflects fluctuations in international oil markets and recommendations put forward by the Oil and Gas Regulatory Authority (OGRA). Consequently, the ex-depot price of HSD has risen from Rs268.38 to Rs275.70 per litre, marking an approximate 2.7% increase. Petrol prices have moved from Rs253.17 to Rs258.17 per litre, reflecting a 2% escalation. The revised rates came into immediate effect on February 16 and will remain applicable for the current fortnight.

High-speed diesel, predominantly consumed by heavy transport vehicles, public service buses, freight carriers, railways, and agricultural machinery, carries inflationary sensitivity due to its direct linkage with freight charges and food supply costs. Petrol, largely utilised in private vehicles, motorcycles, and rickshaws, directly impacts household transportation expenditure.

While general sales tax on petroleum products continues at zero percent, the Government is imposing a petroleum levy of Rs79 per litre on diesel and Rs87 per litre on petrol and high-octane fuels, inclusive of a Rs2.50 per litre climate support levy component. Additionally, customs duties ranging between Rs17 and Rs18 per litre are applicable on both petrol and diesel, irrespective of domestic production or import status. Oil marketing companies and dealers collectively receive distribution and sales margins of approximately Rs17 per litre.

Petrol and diesel together account for monthly consumption volumes estimated between 700,000 and 800,000 tonnes, significantly higher than kerosene’s average of approximately 10,000 tonnes. During FY2025, the Government generated roughly Rs1.161 trillion through petroleum levy collections and has projected receipts of approximately Rs1.470 trillion for the ongoing fiscal year.