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Petrol Prices Reduced in Pakistan

Petrol Prices Expected to Drop by Rs. 15 per Litre

March 13, 2025
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In a much-needed respite for consumers, petrol prices are projected to decline by up to Rs. 15 per litre for the upcoming fortnight, ending March 31. The anticipated reduction is attributed to a combination of global oil price fluctuations and adjustments in import premiums.

Expected Fuel Price Reductions

Preliminary estimates suggest the following price drops:

  • Petrol – up to Rs. 15 per litre
  • High-Speed Diesel (HSD) – up to Rs. 8 per litre
  • Kerosene – up to Rs. 10 per litre
  • Light Diesel Oil (LDO) – up to Rs. 7 per litre

This decline follows a $3 per barrel decrease in Brent crude prices over the last 10 days, contributing to the anticipated cost reduction for local consumers.

Taxation: The Deciding Factor

Despite the positive outlook, the final price cut depends on government taxation policies. The current tax structure on petrol and diesel includes:

  • Petroleum Development Levy (PDL) – Rs. 60 per litre (legally allowed to increase to Rs. 70)
  • Customs Duty – Rs. 16 per litre
  • Dealer and Distribution Margins – Rs. 17 per litre

Although the General Sales Tax (GST) is currently zero-rated, the government collects approximately Rs. 76 per litre in taxes on fuel. Any adjustments to these levies will determine how much relief reaches consumers.

IMF Influence and Potential Tax Hikes

While a drop in petrol prices would be welcomed by the public, there is speculation that the government may increase the petroleum levy or introduce a carbon tax instead. This move could be aimed at securing an additional $1 billion IMF financing for climate adaptation initiatives.

Final Decision on March 15

The exact price reduction will be determined on March 15, based on the latest global oil trends and government policies. If taxes remain unchanged, consumers can expect significant relief at the pump. However, if the government prioritizes fiscal objectives, the price drop may be offset by higher levies.

For now, motorists remain hopeful that the projected reduction will translate into real savings, easing inflationary pressures on households and businesses alike.


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