Subtitle: Petroleum levy rises Rs3.46 per litre in four days as diesel import costs fall, limiting the reduction in HSD prices.
ISLAMABAD, August 8, 2026: The government has continued to increase the Petroleum Levy (PL) on High-Speed Diesel (HSD), raising the levy every day between August 5 and August 8 even as the international diesel benchmark and import-related costs declined, according to official petroleum pricing documents.
The Petroleum Levy on HSD increased from Rs70.82 per litre on August 5 to Rs74.28 per litre on August 8, representing a cumulative increase of Rs3.46 per litre, or nearly 4.9 percent, in four days.
The levy was raised to Rs72.26 per litre on August 6, followed by Rs73.47 per litre on August 7, before reaching Rs74.28 per litre on August 8.
International Diesel Prices Decline
The increase in the government levy came as the international benchmark used for HSD pricing moved in the opposite direction.
The Platts Arab Gulf Mean average used in the HSD pricing calculation fell from $151.10 per barrel on August 5 to $146.24 per barrel on August 8, a decline of $4.86 per barrel.
Other import-related costs also declined during the period.
The cost-and-freight component in rupees fell from Rs273.08 to Rs264.55 per litre, while the diesel cost at Karachi Port declined from Rs273.29 to Rs264.76 per litre.
Similarly, the ex-refinery/import price dropped from Rs288.97 per litre on August 5 to Rs280.44 per litre on August 8.
Levy Rises as Pre-Levy Price Falls
The official pricing sheets show that the HSD price before the Petroleum Levy, Climate Support Levy and Sales Tax declined on each of the four days.
The pre-levy price stood at:
• August 5: Rs310.04 per litre
• August 6: Rs306.60 per litre
• August 7: Rs303.89 per litre
• August 8: Rs301.58 per litre
In contrast, the Petroleum Levy increased each day:
• August 5: Rs70.82 per litre
• August 6: Rs72.26 per litre
• August 7: Rs73.47 per litre
• August 8: Rs74.28 per litre
Thus, the pre-levy price declined by Rs8.46 per litre over the four-day period, while the Petroleum Levy increased by Rs3.46 per litre.
HSD Retail Price Declines by Rs5
Despite the higher levy, the overall HSD price excluding secondary freight declined from Rs385.86 per litre on August 5 to Rs380.86 per litre on August 8.
This represents a reduction of Rs5 per litre, substantially smaller than the Rs8.46 per litre decline in the underlying pre-levy price.
The pricing documents show that the Climate Support Levy remained unchanged at Rs5 per litre throughout the period.
Sales Tax remained at zero, with the official pricing sheets stating that HSD was currently exempt from Sales Tax.
Government Captures Part of Price Decline Through Higher Levy
The four-day comparison highlights a change in the composition of the HSD price.
While the international diesel benchmark and several underlying import-cost components declined, reducing the cost of HSD before levies, the government increased the Petroleum Levy on each pricing date.
The official documents state that the Petroleum Levy is notified by the federal government under the Petroleum Product (Petroleum Levy) and Climate Support Levy Ordinance, 1961.
The pricing sheets also state that the full impact of revisions in daily international prices is passed on within seven working days.
The available data do not establish the specific reason for the daily increases in the levy. However, the figures show that the falling underlying cost of HSD coincided with a rising Petroleum Levy, allowing the government to retain part of the benefit from lower international prices through higher levy collection.
Petroleum Levy Reaches Rs74.28 per Litre
For consumers, the net result has been a decline in the official HSD price, but the reduction has been limited by the increase in the Petroleum Levy.
As of August 8, the Petroleum Levy alone accounted for Rs74.28 per litre of the HSD price.
Together with the Rs5 per litre Climate Support Levy, the two levies add Rs79.28 per litre to the price of HSD, while Sales Tax remains zero.
The latest pricing trend is particularly significant for transport, agriculture and industry, where HSD is widely used and changes in diesel prices can influence freight costs and the prices of goods and services.