ISLAMABAD: The federal government on Sunday reduced the prices of petrol and high-speed diesel (HSD) by Rs2 and Rs4.79 per litre, respectively, for the fortnight ending December 15, due to a minor fluctuation in the international market.

In a late-night anno­uncement, the Petroleum Division said the revision in fuel prices follows movements in international markets and recommendations from the Oil and Gas Regulatory Authority (Ogra).

However, Ogra opted for its weekly off instead of notifying the new LPG prices, which have surged over 20 per cent in the past two weeks in the open market.

According to the announcement, the ex-depot price of HSD has been reduced by Rs4.79 per litre (1.68pc) to Rs279.65 per litre for the current fortnight from the previous rate of Rs284.44.

Most of the transport sector runs on HSD, which is considered inflationary as it powers heavy transport vehicles, trains and agricultural engines like trucks, buses, tractors, tube-wells and threshers, particularly affecting the prices of vegetables and other essential goods.

Transporters had alre­ady increased their fares on the basis of about Rs27 per litre increase between May and August and have not reversed them despite a Rs9 per litre cut.

The ex-depot petrol price has been reduced by Rs2 (0.75pc) to Rs263.45 per litre from Rs265.45. Petrol is primarily used in private transport, small vehicles, rickshaws, and two-wheelers, directly impacting the budgets of middle and lower-middle-class households.

Additional charges

Currently, the government charges about Rs100 per litre on petrol and about Rs96 per litre on diesel.

Although, general sales tax (GST) is zero on all the petroleum products, the government charges Rs78 per litre on diesel and Rs82 per litre on petrol and high-octane products on account of petrol levy and climate support levy. This also includes Rs2.50 per litre climate support levy (CSL).

The government is further charging about Rs16-17 per litre custom duty on petrol and HSD, irrespective of their local production or imports. In addition, about Rs17 per litre in distribution and sale margins are going to oil companies and their dealers.

Petrol and HSD remain major revenue spinners, with their monthly average sales of about 700,000–800,000 tonnes, compared to just 10,000 tonnes of the monthly demand for kerosene.

The government recovered about Rs1.161 trillion through petroleum levies in FY2025 and expects this to rise by around 27pc to Rs1.470tr in the current fiscal year.

Published in Dawn, December 1st, 2025