ISLAMABAD – Pakistani government revised fuel levies in Pakistan, slightly cutting petrol levy while jacking up diesel levy for last week of May 2026.
The move came alongside minor cuts in pump prices, reflecting a balance between public relief and revenue needs amid ongoing inflation pressures. Federal government last week slashed petrol and diesel prices by Rs6–7 per litre for the week ending May 29, 2026, passing on limited relief to inflation-hit consumers amid fluctuations in global oil markets.
The relief was accompanied by adjustments in petroleum levy structure in the weekly fuel price review effective May 23, 2026, as authorities maintained overall revenue targets while reshaping taxation components.
Petroleum Levy (PL)
| Item | Old | New | Change |
|---|---|---|---|
| Petrol | 108.17 | 102.17 | ↓ 6.00 |
| Diesel (HSD) | 42.60 | 58.00 | ↑ 15.40 |
Climate Support Levy
| Item | Rate | Change |
|---|---|---|
| Petrol | 2.50 | No change |
| Diesel (HSD) | 2.50 | No change |
Ex-Depot Prices
| Item | Old | New | Change |
|---|---|---|---|
| Petrol | 409.78 | 403.78 | ↓ 6.00 |
| Diesel (HSD) | 409.58 | 402.78 | ↓ 6.80 |
Ex-Refinery Prices
| Item | Old | New | Change |
|---|---|---|---|
| Petrol | 275.04 | 277.06 | ↑ 2.02 |
| Diesel (HSD) | 337.51 | 322.28 | ↓ 15.23 |
Inland Freight Equalisation Margin (IFEM)
| Item | Previous | New | Change |
|---|---|---|---|
| Petrol | 7.56 | 5.54 | ↓ 2.02 |
| Diesel (HSD) | 1.06 | 3.49 | ↑ 2.43 |
Final Consumer Prices
| Fuel | Price |
|---|---|
| Petrol | 403.78 |
| Diesel | 402.78 |
Under the revised framework, the petroleum levy on petrol was reduced by Rs6 per litre, bringing it down from Rs108.17 to Rs102.17. In contrast, the levy on high-speed diesel (HSD) was increased by Rs15.40 per litre, rising from Rs42.60 to Rs58. The Climate Support Levy remained unchanged at Rs2.50 per litre on both fuels.
Despite the reduction in retail prices, fuel rates continue to remain above the Rs400 mark. The government has set the new consumer price of petrol at Rs403.78 per litre and diesel at Rs402.78 per litre.
On the cost side, ex-refinery prices showed divergent trends. Diesel prices fell from Rs337.51 to Rs322.28 per litre, reflecting a decline in base cost, while petrol increased slightly from Rs275.04 to Rs277.06 per litre.
Meanwhile, adjustments in distribution costs also contributed to the pricing changes. The Inland Freight Equalisation Margin (IFEM) for diesel rose from Rs1.06 to Rs3.49 per litre, while petrol’s IFEM declined from Rs7.56 to Rs5.54 per litre.
Petroleum Levy: Balancing the Budget on the Backs of the Poor
