Petrol Price in Pakistan: Latest Updates and Future Outlook
The petrol price in Pakistan has once again been revised upward, affecting millions of consumers across the country. Effective October 1, 2025, the government has announced an increase of Rs. 4.07 per litre in petrol and Rs. 4.04 per litre in high-speed diesel (HSD). This adjustment follows global oil price trends and domestic fiscal requirements, pushing transportation costs, inflation, and the overall cost of living higher.
Petrol Price in Pakistan Today
Here are the latest official fuel prices as of October 1, 2025:
| Product | Old Price (Rs.) | New Price (Rs.) | Difference (Rs.) |
|---|---|---|---|
| Petrol | 264.61 | 268.68 | 4.07 |
| High-Speed Diesel | 272.77 | 276.81 | 4.04 |
This increase comes after the previous fortnightly review, where diesel prices were adjusted upward while petrol prices remained unchanged. With this latest move, both major fuels have been increased simultaneously, mainly due to rising global crude oil prices and the depreciation of the Pakistani Rupee against the US Dollar.
Breakdown of Petrol Price in Pakistan
Understanding what contributes to the final petrol price in Pakistan requires a breakdown of all charges and levies added to the base ex-refinery cost. Below is the official breakdown of petrol pricing:
| Component | Cost (Rs.) |
|---|---|
| Ex-Refinery Price | 155.67 |
| Petroleum Levy (PL) | 78.02 |
| General Sales Tax (GST) | 0 |
| Inland Freight Equalization Margin (IFEM) | 8.23 |
| Oil Marketing Companies (OMC) Margins | 7.87 |
| Dealer’s Commission (DC) | 8.64 |
Glossary of Terms
- Ex-Refinery Price: Base price of petrol sold by refineries before taxes and levies.
- Petroleum Levy (PL): A direct government-imposed levy collected on each litre of fuel.
- General Sales Tax (GST): Standard value-added tax, though currently set at zero on petrol.
- Inland Freight Equalization Margin (IFEM): Cost equalization to maintain uniform prices across Pakistan despite transport differences.
- OMC Margins: Compensation for oil marketing companies handling storage and supply.
- Dealers’ Commission (DC): Profit margins for retail petrol pump owners.
Why Petrol Prices Are Increasing in Pakistan
Several intertwined factors are responsible for the consistent upward trend in fuel prices across the country:
1. Global Crude Oil Prices
Pakistan is heavily dependent on oil imports. Global oil prices, dictated by OPEC supply policies, international demand, and geopolitical tensions, directly determine how much Pakistan pays for crude oil. The recent surge in global prices has been the biggest driver of this fortnight’s fuel price increase.
2. Exchange Rate Volatility
Oil imports are paid in US dollars. With the Pakistani Rupee continuing to depreciate, the cost of importing petroleum products rises, even if international crude oil prices remain stable. The dollar-rupee parity is therefore a crucial determinant in domestic petrol price adjustments.
3. Government Levies
The Petroleum Levy remains one of the largest contributors to high fuel prices in Pakistan. With fiscal pressures mounting, the government has kept the levy high, resulting in an added burden for consumers. While GST is currently set at zero on petrol, the petroleum levy alone adds a heavy cost component.
4. Domestic Supply and Distribution Costs
Pakistan’s reliance on imports, coupled with high distribution costs, further pushes up fuel prices. The Inland Freight Equalization Margin (IFEM) ensures that consumers in remote regions do not pay disproportionately higher prices, but it adds to the overall cost.
Economic Impact of Rising Petrol Prices
The hike in petrol price in Pakistan has a ripple effect across the economy:
1. Transportation Costs
Public and private transport operators immediately face higher costs, leading to fare hikes. This impacts millions of daily commuters and also raises the costs of transporting goods across the country.
2. Inflationary Pressure
Fuel costs are embedded in the price of nearly every product. From food items to manufactured goods, higher fuel costs push inflation upward, eroding the purchasing power of the average Pakistani household.
3. Agricultural Costs
Pakistan’s agriculture sector relies heavily on diesel-powered machinery and fuel for irrigation and transport. Rising diesel prices increase farming costs, which directly translates into higher food prices.
4. Industrial Impact
Industries dependent on fuel for logistics and production see operational costs rise, reducing competitiveness and profitability. This has long-term implications for Pakistan’s exports and manufacturing sectors.
Future Outlook for Petrol Prices in Pakistan
Looking ahead, the direction of petrol prices in Pakistan will depend on several key factors:
- Global Oil Market Stability: If crude oil prices stabilize or fall, relief may reach Pakistani consumers. However, volatility remains high due to geopolitical conflicts and OPEC’s production controls.
- Exchange Rate Management: The State Bank’s ability to stabilize the rupee will play a critical role in preventing imported inflation through fuel.
- Government Policy: Adjustments in the Petroleum Levy and taxation structure will directly influence petrol prices in the short term.
- Energy Diversification: In the long term, Pakistan’s transition toward renewable energy and the promotion of electric vehicles (EVs) could reduce reliance on expensive petroleum imports.
Conclusion
The latest increase of Rs. 4.07 in petrol and Rs. 4.04 in diesel, effective October 1, 2025, highlights the challenges Pakistan faces in managing fuel prices amid global and domestic pressures. With taxes, levies, and exchange rate fluctuations adding weight to already high international oil prices, Pakistani consumers continue to bear the brunt of rising costs.
The petrol price in Pakistan is more than just a number at the pump—it reflects the nation’s economic vulnerabilities, fiscal strategies, and dependence on global energy markets. As fuel remains a critical driver of inflation and economic activity, future policy decisions and global oil trends will be decisive in shaping the affordability of petrol for millions across the country.
Also check: LPG Price in Pakistan Today