The federal government on Friday increased the prices of petrol and high-speed diesel (HSD) by Rs3.66 and Rs4.80 per litre, respectively, reflecting fluctuations in international oil markets amid renewed tensions in the Persian Gulf.
According to a notification issued by the Petroleum Division, the revised prices came into effect on July 25, 2026 (Saturday) under Pakistan’s newly introduced daily fuel pricing mechanism.
Following the latest revision, the ex-depot price of petrol has increased to Rs335.18 per litre, while high-speed diesel (HSD) now costs Rs383.46 per litre.
The government continues to collect substantial taxes and duties on petroleum products. It is currently charging Rs110 per litre in taxes and duties on petrol and Rs96 per litre on diesel, making petroleum products a major source of federal revenue.
Global Oil Market Volatility Drives Price Increase
The latest adjustment follows continued volatility in international crude oil markets after renewed hostilities in the Persian Gulf disrupted market sentiment and raised concerns over global oil supplies.
The government said the revised prices reflect changes in international petroleum prices and import costs, which are regularly reviewed to align domestic fuel prices with global market trends.
Fuel prices in Pakistan have remained highly volatile in recent months as geopolitical tensions continue to influence international crude oil markets.
Fuel Prices Remain Below Earlier Peaks
Despite the latest increase, current fuel prices remain significantly below the record levels witnessed earlier this year.
High-speed diesel had reached a historic high of Rs520.35 per litre on April 3, after climbing steadily from around Rs281 per litre following the outbreak of the US-Iran conflict on February 28.
Similarly, petrol prices peaked at Rs458.41 per litre on April 3, after rising from approximately Rs266 per litre during the first week of March.
Although prices have eased considerably from those record highs, they remain elevated compared with levels seen before the regional conflict intensified.
Pakistan Shifts to Daily Fuel Pricing
The latest revision is part of Pakistan’s transition from weekly to daily petroleum price adjustments.
Earlier this month, Petroleum Minister Ali Pervaiz Malik announced that fuel prices would now be determined on a daily basis, replacing the weekly review system introduced earlier in the year.
The minister said the federal cabinet and Prime Minister Shehbaz Sharif had authorised the Oil and Gas Regulatory Authority (OGRA) to determine daily fuel prices based on international market movements.
The government introduced the new pricing mechanism to respond more quickly to changes in global oil prices and reduce distortions in the domestic petroleum market.
Since early March, Pakistan had been announcing weekly fuel price revisions while also implementing fuel conservation measures amid concerns over possible supply disruptions linked to the Middle East conflict.
The government had also introduced targeted fuel subsidy measures in April to provide limited relief to eligible consumers during the period of exceptionally high international oil prices.
Dealers Oppose Daily Price Changes
The new daily pricing system has faced opposition from petroleum dealers.
The All Pakistan Petroleum Dealers Association has rejected the government’s decision, arguing that frequent price revisions create operational difficulties for filling stations and uncertainty for consumers.
The association has announced that it will consider a protest strategy during the coming week against the implementation of daily fuel price adjustments.
Higher Fuel Prices Affect Consumers and Businesses
Petrol remains the primary fuel used by private vehicles, motorcycles, rickshaws and small commercial transport, meaning any increase directly affects millions of middle- and lower-middle-income households.
Higher petrol prices also increase commuting expenses and transportation costs for businesses and consumers alike.
Meanwhile, high-speed diesel is widely used by heavy transport vehicles, agricultural machinery, power generation facilities and industrial equipment.
As a result, increases in diesel prices often lead to higher freight charges, rising production costs and additional inflationary pressure across multiple sectors of the economy.
Petroleum Products Remain Major Revenue Source
Petrol and high-speed diesel continue to be Pakistan’s largest-selling petroleum products and generate significant tax revenue for the government.
Combined monthly sales of petrol and HSD range between 700,000 and 800,000 tonnes, making them the backbone of the country’s petroleum market.
By comparison, monthly demand for kerosene remains relatively low at around 10,000 tonnes, highlighting the dominant role of petrol and diesel in Pakistan’s energy consumption and government revenue collection.