ISLAMABAD (HRNW): The federal government has announced a massive increase in the prices of petroleum products, effective from April 3, 2026. This record-breaking hike comes after the International Monetary Fund (IMF) reportedly declined the government’s request for further general subsidies, urging instead for fiscal discipline and targeted relief for low-income segments.
New Prices and Breakdown
The Ministry of Petroleum and the Finance Ministry, in a joint press conference, notified the new rates, citing the mounting pressure of global oil disruptions caused by the Middle East conflict and the need to align with IMF program conditions.
| Product | New Price (per Litre) | Previous Price | Increase |
| Petrol | Rs 458.40 | Rs 321.17 | +Rs 137.23 |
| High-Speed Diesel | Rs 520.35 | Rs 335.86 | +Rs 184.49 |
| Kerosene Oil | Rs 457.80 | Rs 423.72 | +Rs 34.08 |
The IMF Factor and Fiscal Measures
Finance Minister Muhammad Aurangzeb stated that the government had attempted to provide relief through existing levies, but the IMF maintained a strict cap on fuel-related subsidies at Rs 152 billion. To bridge the fiscal gap and ensure the release of the next $1.2 billion loan tranche, the government significantly increased the petroleum levy:
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Petroleum Levy on Petrol: Raised to a record Rs 161 per litre (up from Rs 106).
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Diesel Adjustment: While the levy on diesel was reportedly abolished to mitigate the impact on the transport sector, the base price rose sharply due to international market rates crossing $250 per barrel.
Government’s Appeal for Austerity
Acknowledging the “unprecedented burden” on the public, the government has urged citizens to exercise extreme caution in fuel consumption. Prime Minister Shehbaz Sharif has directed a committee to ensure uninterrupted supplies while focusing relief efforts on vulnerable groups through the Benazir Income Support Programme (BISP) and provincial targeted subsidy apps.
The sharp rise is expected to trigger a secondary wave of inflation, particularly affecting transportation costs and the prices of essential food items across the country.
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