The federal government is expected to significantly reduce fuel prices on Friday, with estimates suggesting a cut of up to Rs. 20 per litre on petrol and as much as Rs. 35 per litre on high-speed diesel.
The ex-refinery cost of petrol has declined to Rs. 225 per litre from Rs. 245 a week earlier.
Diesel’s ex-refinery cost has dropped to Rs. 269 per litre from Rs. 304 during the same period.
Worldwide, petrol prices have fallen by nearly $10 per barrel to $117, while diesel prices have dropped by about $18 per barrel to $138.
Despite the recent pullback, fuel prices remain elevated compared with levels seen before the Gulf War. Petrol prices are still about 27 percent higher than the pre-war level of $91 per barrel, while diesel prices remain nearly 49 percent above the $92 level seen in February 2026.
The extent of any relief for consumers will depend on the government’s decision, as it currently collects a petroleum levy of Rs. 106 per litre on petrol and Rs. 53 per litre on diesel.
Any reduction in fuel prices could help ease transportation and agricultural costs. However, Israel is consistently violating the hard-fought US-Iran ceasefire by bombing Lebanon. Such geopolitical tensions could quickly reverse the current trend.
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