ISLAMABAD: Pakistan is expected to see a significant hike in petroleum prices starting July 1, 2025, despite falling global oil prices, citing official sources.
According to initial estimates, the price of high-speed diesel may increase by Rs14.86 per litre, while petrol could see a jump of Rs11.43 per litre for the next pricing cycle.
The Oil and Gas Regulatory Authority (OGRA) is set to submit its summary on revised petroleum prices later today. The Petroleum Division and the Ministry of Finance will review the proposal before forwarding it to Prime Minister Shehbaz Sharif for final approval.
Global Oil Prices Dip
International oil prices declined on Monday amid easing geopolitical tensions in the Middle East and expectations of another OPEC+ output increase in August. Brent crude futures fell by 12 cents to $67.65 per barrel, while the more active September contract dropped to $66.56, reflecting continued uncertainty over global demand recovery.
Controversy Over Carbon Levy
The expected domestic fuel price hike comes amid ongoing debate over the government's proposed Rs2.5 carbon levy on petrol as part of the federal budget for FY2025-26.
Last week, the Senate Standing Committee on Finance rejected the carbon levy proposal with a majority vote. Senator Sherry Rehman of the PPP strongly opposed the move, arguing that a carbon levy is not the same as a carbon tax, and such a charge requires proper legislation rather than implementation through the finance bill.
She added, “There is no precedent globally for imposing a carbon levy. Carbon taxes, where applied, are enacted through law—not finance bills.”
IMF Push for Fuel Price Rationalisation
The International Monetary Fund (IMF) has also urged the government to rationalise fuel pricing, including a proposed increase for cash-based petrol and diesel purchases, as part of ongoing fiscal reforms under its loan programme.
The final decision on the upcoming price revision is expected later this week, ahead of the July 1 implementation date.
