Major cut in diesel price announced

WASIM IQBAL

ISLAMABAD: Following a meeting with local refineries, the Petroleum Division has announced a major adjustment in High Speed Diesel (HSD) prices effective from August 20. The fuel saw a sharp drop of 8.1 percent, providing significant financial relief to transporters and farmers.

With this revision, HSD prices fell by Rs32.63 per litre, bringing the new rate from Rs395.69 to Rs363.06 per litre. Conversely, petrol prices experienced a slight hike of Rs2.97 per litre, rising from Rs334.54 to Rs337.51 per litre.

Petroleum Minister Ali Pervez Malik, speaking to the media alongwith Information Minister Attaullah Tarar, said diesel prices would be reduced by Rs30 to Rs32 following the discussions with refineries.

Addressing ongoing economic challenges, Minister Malik reaffirmed the administration’s commitment to shielding citizens from inflation, highlighting a recent allocation of over Rs100 billion despite IMF program constraints.

He assured the public of reliable fuel availability, even as renewed regional hostilities drive up international refined petroleum prices. Malik pointed to extreme market volatility diesel crack margins reaching USD60 to USD70 above crude oil and emphasised the crucial role of local refineries in meeting the country’s diesel demand.

The Petroleum Levy (PL) has been raised by Rs2 per litre on HSD (from Rs78.28 to Rs80), while petrol remains unchanged at Rs80 per litre. While, customs duty has maintained at Rs21 per litre for petrol and Rs15.68 per litre for HSD. Climate Support Levy (CSL) has been held steady at Rs5 per litre for both fuels. Oil Marketing Companies (OMCs) and dealers margins remain unchanged at Rs7.87 and Rs8.64 per litre, respectively, across both products.

The seven-day rolling average for Platts Arab Gulf Mean prices on August 20 saw Petrol (Gasoline 92 RON) rise to USD105.88/bbl from USD104.57/bbl on August 19. Meanwhile, High-Speed Diesel (HSD) dropped significantly to USD89.46/bbl from the previous review’s USD152.80/bbl, according to the data available at Ogra website.

The dealers margin will increase from September 1, 2026 by Rs1.34 per litre. The Economic Coordination Committee (ECC) had approved an increase of Rs1.34 per litre in the profit margins for petroleum dealers on petrol and HSD. This adjustment raises the fixed margin from Rs8.64 to Rs9.98 per litre, averting a threatened nationwide strike by the Pakistan Petroleum Dealers Association (PPDA).

Under the daily pricing framework, Ogra adjusts fuel rates based on currency exchange fluctuations and a seven-day rolling average.

ZULFIQAR AHMAD adds: Earlier, Prime Minister Shehbaz Sharif had directed Petroleum Minister Ali Pervaiz Malik to rush to Karachi and take up the issue of locally produced diesel prices with oil refineries, and secure immediate relief for consumers.

Chairing a meeting, the prime minister told Malik to reach Karachi without delay and personally negotiate with the refineries for a reduction in diesel prices.

With diesel costs feeding into transport fares, freight charges and the price of goods, the government appears increasingly keen to get ahead of a fuel-price issue that has become politically combustible.

The prime minister pointed out that a substantial portion of the country’s diesel is produced by local refineries, questioning why consumers should continue to bear the full weight of prevailing prices.

“Take every possible step to ensure immediate relief reaches the public,” the prime minister directed.

The message to the petroleum ministry was blunt: no waiting for the next routine pricing cycle and no room for prolonged negotiations.

The prime minister tasked the petroleum minister with wrapping up talks with the refineries as quickly as possible and delivering a cut in the price of locally produced diesel.

The move puts the refineries under direct pressure while handing the petroleum minister the unenviable task of returning from Karachi with something tangible for consumers.

Fuel prices have long been a politically sensitive fault line, with motorists, transporters, businesses and ordinary consumers feeling the impact of higher diesel costs.

Any reduction secured from domestic producers could offer the government some much-needed breathing space.

The prime minister’s intervention also marks a more muscular approach to the issue: instead of leaving the matter to the usual pricing machinery, he has dispatched his petroleum minister to Karachi to negotiate relief at source.

The meeting was attended by MNA Hamza Shehbaz, the prime minister’s influential son, as well as Petroleum Minister Malik, Information Minister Attaullah Tarar, Economic Affairs Minister Ahad Cheema and Climate Change Minister Musadik Malik.