Prime Minister Shehbaz Sharif-led federal government is poised to announce a substantial hike in petrol prices, effective July 1, in line with the implementation of the Budget 2024-25.

This will be the first price revision since the budget for the fiscal year 2024-25 was presented on June 12.

In the recently proposed Finance Bill 2024, the government has introduced a notable increase in the maximum petroleum levy, raising it by Rs20 to Rs80 per litre.

This adjustment is expected to have a significant impact on petrol and high-speed diesel (HSD) prices nationwide.

Current petrol, diesel prices in Pakistan

Currently, petrol is priced at Rs258.16 per litre, while HSD stands at Rs267.89 per litre, following a reduction earlier this month by Rs10.20 and Rs2.33, respectively. However, with the new levy, these prices are anticipated to rise sharply.

Petroleum levy

The petroleum levy has been identified as a crucial revenue stream for the government, which is seeking to bolster its finances and secure another bailout package from the International Monetary Fund (IMF).

This move aims to enhance the government’s revenue, targeting Rs12.97 trillion for the Federal Board of Revenue (FBR) in the upcoming fiscal year.

Market analysts predicted that the increase in the petroleum levy will directly translate to higher fuel costs for consumers. The precise extent of the price rise will be confirmed on June 31, when the government finalizes the revision.

The expected surge in fuel prices comes at a time when the public is already grappling with inflationary pressures, and this development is likely to exacerbate the economic burden on households and businesses alike.