By Staff Reporter
ISLAMABAD: Pakistan raised gasoline and diesel prices for a second consecutive day, as the country’s new daily fuel-pricing mechanism continued to pass through the effects of Middle East volatility to motorists and transporters.
The Petroleum Division said in a notification on Tuesday that the price of petrol will rise by 1.63 rupees to 335.81 rupees a liter, effective Wednesday. High-speed diesel will increase by 1.55 rupees to 388.38 rupees a liter over the same period. The revisions were issued by Ogra, Pakistan’s Oil and Gas Regulatory Authority, from its offices in Islamabad.
The increases follow a pattern in place since Pakistan abandoned periodic fuel-price reviews last week in favor of daily adjustments pegged to a rolling average of international benchmarks. Petroleum Minister Ali Pervaiz Malik said the shift was designed to let domestic prices track global crude markets more closely, at a time when tensions between the US and Iran have kept oil prices unsettled.
Malik announced the move to daily pricing on July 17, alongside Information Minister Attaullah Tarar, saying the decision had been approved by a federal cabinet led by Prime Minister Shehbaz Sharif. Malik said the government had made “tremendous efforts,” including through Sharif and Field Marshal Asim Munir, the army chief, to push the region toward a lasting ceasefire, but that tensions had begun rising again. The daily-pricing system took effect July 18.
It replaces a weekly review process that Pakistan had used since early March, when the government began adjusting prices more frequently in response to the standoff between Washington and Tehran. Before that, fuel prices in Pakistan were revised only once every two weeks.
Under the new framework, Ogra calculates prices using a seven-working-day rolling average of Platts benchmark assessments for Motor Spirit and high-speed diesel, rather than waiting for a fixed review date. The regulator can publish updated prices without prior sign-off from the prime minister or the federal government, though each notification is still reported to the Directorate General of Oil. Prices set on Fridays remain in force through the weekend. Ogra has also been instructed to publish its daily Platts reference prices starting July 1, giving the public a way to compare international benchmarks against domestic rates.
The petroleum levy embedded in pump prices is capped at a limit set by the federal cabinet, and any change to that levy requires sign-off from the Finance Division, according to the framework governing the new mechanism.
Separately, the government raised the price of kerosene by 1.96 rupees a liter in a notification issued Monday, bringing it to 303.10 rupees a liter.
Fuel prices in Pakistan have swung sharply this year. Petrol touched a record 458.41 rupees a liter on April 3, after climbing from around 266 rupees in early March, as the fallout from the U.S.-Iran standoff rattled global crude markets. Diesel peaked the same day at 520.35 rupees a liter. Both have since retreated well off those highs, though they remain elevated by the standard of prices earlier in the year.
Petrol and diesel are Pakistan’s two largest sources of fuel-tax revenue, with combined monthly sales of roughly 700,000 to 800,000 tonnes, dwarfing the roughly 10,000 tonnes of kerosene sold each month. Petrol is used mainly in motorcycles, rickshaws and private cars, making it especially sensitive for middle- and lower-income households, while diesel powers much of the country’s freight transport, agricultural machinery and backup power generation, giving it a broader knock-on effect on the price of goods and electricity.
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