Petrol price update in Pakistan – March 25, 2026

ISLAMABAD: In a significant move after Eid-ul-Fitr, the federal government has decided to keep petroleum prices unchanged in Pakistan, as global oil prices dropped by more than 6% amid hopes of de-escalation in the Iran conflict.

Oil prices fell sharply while global stocks rose on Wednesday following reports that Washington had conveyed a peace proposal to Iran through Pakistan. Tehran also indicated it would allow “non-hostile” oil vessels to pass through the strategically important Strait of Hormuz, easing supply concerns.

According to sources, the government opted to maintain current fuel prices and instead proposed a reduction of Rs 100 billion in the development budget to manage financial pressures.

Sources said funding for ongoing development projects will be cut by 10%. The total development budget for the current fiscal year is likely to be reduced from Rs 1,000 billion to Rs 900 billion.

The savings will be redirected towards emergency relief measures, which are also expected to help contain the fiscal deficit.

The Oil and Gas Regulatory Authority (OGRA) will submit its working to the Petroleum Division in two days. The final decision on future price will be made by the Prime Minister of Pakistan, Shehbaz Sharif.

Meanwhile, the All Pakistan Petrol Pump Owners Association (APPPOA) has expressed serious reservations over the mechanism for determining petroleum prices.

The association has urged the Federal Minister for Petroleum Ali Pervaiz Malik to take stakeholders into confidence regarding the pricing formula.

Vice Chairman Noman Butt said around 15,000 petrol pump owners have concerns over the current system.

He warned that if their demands are not addressed, petrol pump owners may shut down their pumps nationwide.

He added that, given the current situation, no further crisis should be created, and the petroleum minister would be responsible if the issue remains unresolved.

It should be noted that following the Iran war, the government announced Rs.55 per litre increase in petrol and diesel prices on 7 March 2026, taking petrol to Rs.321.17 per litre and diesel to Rs.335.86 per litre.