Living in Pakistan these days means keeping a close eye on your wallet, especially when it comes to filling up your tank. Fuel prices have been a hot topic, and recent documents uncovered that’s shows just how much taxes we’re paying beyond the raw cost of petrol and diesel.
Turns out, it’s not just the oil itself—it’s the taxes, duties, and margins stacked on top that are hitting consumers hard. Let’s break it down and see what’s really going on as of 2025.
The Real Cost of Fuel: More Than Meets the Eye
Before all the extras get added, petrol starts at an ex-refinery price of Rs148.51 per litre, while high-speed diesel (HSD) sits at Rs154.06 per litre. That’s what it costs straight from the refinery. But by the time it reaches your local pump, you’re shelling out Rs255.63 for petrol and Rs258.64 for HSD. So, where’s the extra Rs100 or so per litre coming from? Here’s the scoop:
- Petroleum Levy: This is the big one—Rs70 per litre on both petrol and HSD. It’s a flat charge the government slaps on to keep its coffers full.
- Customs Duties: Petrol gets hit with Rs15.28 per litre, while HSD pays a bit more at Rs15.78. Not a huge difference, but it adds up.
- Dealer Commission: The folks running the pumps take Rs8.64 per litre. Fair enough—they’ve got to make a living too.
- Oil Marketing Companies’ Cut: The companies moving the fuel around pocket Rs7.87 per litre as their margin.
- Freight Costs: Known as the Inland Freight Equalization Margin (IFEM), this covers transporting fuel across the country. It’s Rs5.33 per litre for petrol and Rs2.30 for HSD.
Add it all together, and you’ve got Rs107.12 tacked onto every litre of petrol and Rs104.59 for HSD. That’s more than 40% of the final price coming from taxes and fees alone.
A Small Mercy: No Sales Tax (For Now)
Here’s a bit of good news amid the numbers—the government isn’t charging sales tax on petrol or diesel right now. Zero, zilch, nada. That’s a relief when you consider how much we’re already paying. Without it, the price stays at Rs255.63 for petrol and Rs258.64 for HSD. Still steep, but it could’ve been worse.
Price Freeze and a Power Play
On March 15, Prime Minister Shehbaz Sharif stepped up and said fuel prices aren’t budging for the next two weeks. The Finance Division backed him up with an official notice, locking in the current rates. Now, here’s the twist: global oil prices have dipped lately, which could’ve meant cheaper fuel for us. But instead of dropping pump prices, the government’s channeling those savings into cutting electricity bills. It’s a bold move—keeping fuel steady while trying to ease the sting of power costs. Time will tell if it pays off for folks like you and me.
What’s in Your Tank? A Price Breakdown
Let’s lay it out plain and simple:
Petrol (Rs255.63 per litre)
- Base Cost: Rs148.51
- Petroleum Levy: Rs70.00
- Customs Duty: Rs15.28
- Dealer’s Take: Rs8.64
- OMC Margin: Rs7.87
- Freight: Rs5.33
- Sales Tax: Rs0.00
HSD (Rs258.64 per litre)
- Base Cost: Rs154.06
- Petroleum Levy: Rs70.00
- Customs Duty: Rs15.78
- Dealer’s Take: Rs8.64
- OMC Margin: Rs7.87
- Freight: Rs2.30
- Sales Tax: Rs0.00
Seeing it like this makes it clear: a big chunk of what we’re paying isn’t even for the fuel itself.
Why It Hits Home
If you’re driving to work, hauling goods, or running a generator, these prices matter. Petrol at Rs255.63 and HSD at Rs258.64 mean higher costs for everything—transport, food, you name it. Freezing prices instead of cutting them might feel like a missed chance, but if the government delivers on cheaper electricity, it could take some pressure off. Still, that Rs70 petroleum levy stings—it’s a reminder of how much fuel taxes prop up the budget.
What’s Next for Fuel Prices?
With global oil prices bouncing around and Pakistan juggling its finances, fuel costs could go either way. Will that Rs70 levy stick around forever? Might sales tax sneak back in if money gets tight? For now, we’re locked in at these rates until at least the end of March. After that, it’s anyone’s guess how the government will play its cards.
Wrapping It Up
Fuel in Pakistan isn’t cheap, and it’s not just because of oil prices. Between the petroleum levy, customs duties, and all the margins, consumers are carrying a heavy load—Rs107.12 extra per litre for petrol and Rs104.59 for HSD. Skipping sales tax helps, and the price freeze keeps things predictable, but it’s hard to ignore how much of our money is going to taxes. The shift toward lower power bills is a glimmer of hope, though—maybe it’ll balance things out down the road.
What do you think? Should the government ease up on fuel taxes or keep leaning on them to fund other relief? Drop your take below—I’d love to hear how this is hitting your
