The federal government has set a target of Rs. 1.676 trillion in petroleum levy receipts for FY27, based on an average levy of Rs. 80 per liter on petrol and High Speed Diesel (HSD).
Minister for Energy (Petroleum Division) Ali Pervaiz Malik informed the National Assembly in a written response that the levy, which was reduced during a period of volatility in international oil markets to provide relief to consumers, is being restored in phases in line with the approved budget target.
The levy on petrol and HSD underwent several revisions after the start of the current fiscal year. On July 1, the levy stood at Rs. 66.64 per liter on petrol and Rs. 79.54 on HSD. It was revised to Rs. 64.14 and Rs. 77.04, respectively, on July 2, before being changed to Rs. 70.36 on petrol and Rs. 70.82 on HSD on July 4.
The petrol levy reached the budgeted level of Rs. 80 per liter on July 11, while the HSD levy was gradually increased in August. It reached Rs. 78.28 per liter on August 14, before rising to Rs. 80 per liter for both petrol and HSD by August 20.
Overall, the levy on petrol increased by Rs. 13.36 per liter between July 1 and August 20.
The minister said the Petroleum Division had not carried out a separate assessment of the levy’s impact on specific categories of consumers. He added that petroleum levy collection targets were part of the approved federal budget and linked to fiscal commitments made with international financial institutions.
Responding to questions about reducing the levy to provide relief to consumers, Malik said any reduction would depend on available fiscal space, commitments with international financial institutions, revenue requirements and international oil market conditions.
The minister added that the government passes on the benefit of declining international oil prices to consumers whenever possible, suggesting that any future reduction in domestic fuel prices would depend on global oil prices and the government’s fiscal position.
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