Petroleum levy removal would reduce petrol, diesel prices, Minister tells NA panel

ISLAMABAD, July 7, 2026: Petroleum Minister Ali Pervaiz Malik said removing the petroleum levy would bring a noticeable drop in petrol and diesel prices, but the government would then have to find another way to cover the revenue loss, ARY News reported.

He was speaking at a meeting of the National Assembly Standing Committee on Petroleum chaired by Syed Mustafa Mahmud.

Ali Pervaiz Malik said the government had to take tough but necessary decisions during the recent US-Israel-Iran crisis. “If fuel had run out at even one petrol pump, it could have created a serious situation,” he said. He added that several countries had to deploy the army during fuel shortages. Refined products in the international market are still more expensive than they were before the war, he noted.

On the levy, the minister said either government expenses are met through the levy or the public ends up bearing the burden of inflation. “We need to explain to people the gap between global and local prices,” he said.

Committee members raised concerns over LPG pricing. One member asked why OGRA’s notified rates are not being enforced.

The minister replied that LPG prices are set based on international propane and butane rates. Only 30 to 40 percent of Pakistan’s LPG demand is met through local production. The rest is imported, so prices are tied to import costs.

He said LPG auctions are currently on hold because of a court stay order. The Attorney General approached the court on the issue and the court sent the matter back to OGRA for review. Enforcing LPG regulations is OGRA’s job, he added.

Committee Chairman Syed Mustafa Mahmud said OGRA will be called to give a detailed briefing.

The minister also told the committee that the country is moving toward Euro-5 fuel standards. The refinery upgrade policy has been sent to the federal cabinet and he expects it to be approved in the next meeting.

After approval, the upgrade process will begin, he said. DG Oil will brief the committee on the details. “We will not put the burden of refinery inefficiencies on consumers,” Malik said. “Ending additional financial pressure on consumers is a decision made by Prime Minister Shehbaz Sharif.”

Also Read: Petrol price in Pakistan: Here’s how much goes to taxes, levies