Petrol and Diesel Prices likely to rise Amid regional tensions

ISLAMABAD: (Rizwan Abbasi) Fears of a rise in the prices of petroleum products have intensified once again due to the tense situation in the region.

According to sources, the federal government will announce new prices of petroleum products tomorrow as per the weekly schedule, however, there are possibilities of an increase in the prices of petrol and high-speed diesel.

Sources say that the government has limited financial capacity, while the effects of prices in the global market and regional tensions are also being felt on the country’s economy.

According to officials, if the full burden of prices is transferred to the public, there is a risk of a new wave of inflation. That is why the government is considering various options so that the full burden is not transferred to the public.

According to sources, the federal government has also requested the provinces to contribute their share in the subsidy on petroleum products. Apart from this, the full burden of prices can also be prevented from being transferred to the public by reducing the petroleum levy. The government is also considering a proposal to provide targeted subsidies instead of general subsidies, under which a proposal to provide special relief on petrol to motorcycle and rickshaw users is under consideration.
According to sources, the federal government is currently collecting a levy of Rs 105.37 per liter on petrol and Rs 55.24 per liter on high-speed diesel.

The government has borne a huge financial burden by not increasing the prices of petrol and high-speed diesel for the last three consecutive times.

According to officials, the federal government is currently bearing the burden of Rs 203.88 per liter on high-speed diesel and Rs 95.69 per liter on petrol. Due to maintaining the prices of petrol and diesel, the government has incurred an additional burden of about Rs 129 billion in total, which is being met through reduction in development expenditure and savings. In this regard, about Rs 100 billion has also been cut in the federal development budget so far.

According to the data, there has been a significant increase in the price of kerosene during the past one month and it has been increased by Rs 252 and 87 paise per liter. During the same period, the price of petrol has increased by Rs 63 and the price of high-speed diesel by Rs 60 and 16 paise.

According to the documents, on February 28, 2026, the price of petrol was Rs 258 and 17 paise per liter, which has now increased to Rs 321 and 17 paise per liter. Similarly, the price of high-speed diesel was Rs 275 and 70 paise per liter on February 28, which has now increased to Rs 335 and 86 paise per liter.

At the same time, the price of kerosene has also increased significantly. On February 28, 2026, the price of kerosene was Rs 183 and 53 paise per liter, which has now been increased to Rs 433 and 40 paise per liter.
According to sources, the government has also increased the levy on petrol by about twenty-one rupees per liter during March, while financial capacity, global market trends, and public relief aspects will be taken into account in determining future prices.