Islamabad – January 17, 2026: Despite significant declines in ex-refinery prices (Petrol down Rs32.33/ltr and High-Speed Diesel down Rs25.06/ltr since March 2025), the government has substantially increased the Petroleum Development Levy (PDL) — pushing it to Rs84.27/ltr on MS (petrol) and Rs76.21/ltr on HSD (diesel).
According to a detailed analysis by Arif Habib Limited, this strategy has allowed retail prices to remain relatively stable (currently Rs253.17/ltr for petrol and Rs257.08/ltr for diesel as of mid-January 2026) while significantly boosting government revenue.
Half-year collections have already reached ~Rs748.5 billion toward the ambitious full-year FY26 target of Rs1,468 billion, putting the government broadly on track for one of the highest-ever petroleum levy hauls.Headline: Smart Revenue Play:
Falling Global Oil Prices Used to Fund Rs1,468 Billion FY26 Levy Target
While international oil prices and local ex-refinery costs have trended downward for most of 2025–2026, the government has utilized this space to sharply raise the Petroleum Development Levy — up from the earlier baseline of Rs60/ltr to current levels of Rs84.27/ltr (petrol) and Rs76.21/ltr (diesel).
Market experts at Arif Habib Limited highlight this as a deliberate fiscal move that cushions retail prices from global volatility while accelerating non-tax revenue collection — critical for meeting IMF-aligned fiscal targets and funding the budget without direct pump-price shocks.