Pakistan Raises Petroleum Levy Despite Fall in Global Oil Prices

Islamabad: Despite a significant decline in international crude oil and petroleum product prices, the federal government has increased the petroleum levy on petrol and high-speed diesel, a move that has prevented domestic fuel prices from falling.

According to media reports, the government increased the petroleum levy on high-speed diesel (HSD) by Rs6.57 per litre, raising it from Rs72.97 to a record Rs79.54 per litre. The levy on petrol was also increased by Rs0.39 per litre, from Rs66.25 to Rs66.64 per litre.

The report said the government has kept the levy on kerosene oil unchanged at Rs20.36 per litre, while the levy on light diesel oil (LDO) remains Rs15.84 per litre.

The increase comes despite a sharp decline in international fuel prices. Petrol prices in the global market reportedly fell from $98.35 per barrel on June 22 to $91.68 per barrel on June 26, a decrease of $6.67 per barrel in just four days.

Similarly, the price of high-speed diesel declined from $109.09 per barrel on June 22 to $104.79 per barrel on June 26.

Economic analysts and consumer groups have argued that the reduction in international oil prices should have translated into lower fuel prices for consumers. However, they contend that by increasing the petroleum levy, the government effectively offset the benefit of the global price decline, leaving domestic petrol and diesel prices largely unchanged.