Significant increase in Petrol Price In Pakistan due to Global Conflict

The government of Pakistan has been notified of a significant price increase for petroleum products due to the Iran-Israel war. It was expected that the government of Pakistan would increase the petrol price due to the petroleum levy increase in the Finance Act 2025 and the IMF's strict conditions to be followed by Pakistan. However, many were not expecting that the price would increase from the get-go, especially the price increase from the 1st of July.

It is expected that the government of Pakistan will have to increase prices further or maintain the status quo because Pakistan cannot afford cheap petrol prices because of fears among the authorities that reducing petrol prices will not benefit Pakistan. It is analyzed that reducing petrol prices at this stage would affect tax collection figures as well, and it would also create pressure on Pakistan's forex reserves as well. 

Pakistan has increased its petrol price from PKR 258.43 to 266.79 as of today, and the high-speed diesel price of 262.59 increased to 272.98 as of today. It is expected that the government of Pakistan will not reduce the petroleum levy and might maintain it for a longer term till the end of this fiscal year.