Consumers in Pakistan may see relief at the pump with a potential reduction of Rs2.97 per litre in petrol prices starting September 1, 2024. This comes in response to global oil market fluctuations.
Preliminary government estimates suggest price cuts for:
- High-speed diesel (HSD) by Rs2.31 per litre
- Kerosene oil by Rs1.19 per litre
- Light diesel oil (LDO) by Rs1.96 per litre
If implemented, petrol prices could drop from Rs260.96 to Rs257.99 per litre, while HSD prices could fall from Rs266.07 to Rs263.76 per litre. Kerosene oil might be reduced to Rs170.38 per litre, and LDO could decrease to Rs155.06 per litre.
These estimates are based on the current tax structure, including the Petroleum Levy, which was increased in the 2024-25 fiscal year budget from Rs60 to Rs70 per litre. However, the levy has remained at Rs60 per litre thus far.
The government has kept sales tax on petroleum products at zero, directing revenue collection primarily through the Petroleum Levy, which benefits the federal government. This tax structure has left provinces out of the revenue pool typically generated by sales tax on petroleum products.
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