Islamabad, July 15, 2025 – In what could be another blow to inflation-stricken consumers, the federal government is expected to raise petroleum prices for the second half of July 2025.
The anticipated increase in petroleum prices comes amid fluctuating international oil rates, rising import premiums, and the government’s revenue goals through the Petroleum Levy (PL) and Carbon Sustainability Levy (CSL).
According to initial industry estimates, the price of petrol may go up by Rs6.60 per liter, while high-speed diesel (HSD) could see an increase of Rs5.27 per liter, effective from July 16. However, not all petroleum products are set for an upward adjustment. Kerosene oil and Light Diesel Oil (LDO) are likely to experience price reductions of Rs3.74 and Rs2.23 per liter, respectively, offering slight relief for sectors dependent on these fuels.
The projected petroleum prices are based on various cost components including Rs78.02 per liter in PL and CSL on petrol, and Rs77.01 per liter on HSD. The Inland Freight Equalization Margin (IFEM) has also been factored in, standing at Rs8.89 per liter for petrol and Rs6.04 for HSD. Additionally, exchange rate adjustments are estimated at Rs3 per liter on petrol and Rs2 on HSD. The international premium rate is reportedly $9.68 per barrel for petrol and $3.25 per barrel for HSD, reflecting the costs incurred on imported petroleum products.
The Oil and Gas Regulatory Authority (OGRA) is expected to finalize its recommendations today (July 15), after assessing recent global oil market developments. The Finance Division will then announce the revised petroleum prices, aligning them with the government’s fiscal objectives and international commitments.
If the projected adjustments are implemented, the price of petrol will increase from the current Rs266.79 to Rs273.39 per liter, while HSD will jump from Rs272.98 to Rs278.25 per liter.
Earlier this month on July 1, the government had already raised petroleum prices significantly, attributing the hike to global market instability linked to the ongoing Iran-Israel conflict. Petrol had then risen by Rs8.36 and HSD by Rs10.39.
Pakistan relies heavily on petroleum imports, with about 85% of its petrol consumption met through refined imports, and only 15% from crude oil, making domestic prices highly vulnerable to global trends.