On Friday night, the federal government increased the price of petrol by Rs 2.43 per liter and high speed diesel (HSD) by Rs 3.02 per liter over the next fortnight.
In a late-night announcement, the Finance Ministry said the review followed movements in international markets and recommendations from the Oil and Gas Regulatory Authority (Ogra) and relevant ministries.
According to the notification, the price of petrol now stands at Rs 265.45 per liter from Rs 263.02 per litre. Meanwhile, diesel price has increased to Rs 278.44 per liter from Rs 275.42 per litre.
Most of the transport sector is powered by HSD and its price is considered inflationary as it is mainly used in heavy transport vehicles, trains and agricultural engines such as trucks, buses, tractors, tube wells and threshers and in particular increases the prices of vegetables and other grocery products.
Gasoline is mainly used in private transport, small vehicles, rickshaws and two-wheelers, and directly impacts the budgets of the middle and lower-middle classes.
Ogra also notified a cut of Rs 5.88 per kilogram (2.83 per cent) in the consumer price of LPG to Rs 201.60 per kg (from Rs 207.49 per kg).
The price of an 11.8 kg cylinder has been fixed at Rs 2,378.89 for November, down Rs 69.44 from Rs 2,448.53 in October. The government charges around Rs 37,342 per tonne in GST and a petroleum tax on LPG.
The government charges around Rs 99 per liter for both petrol and diesel. Although the general sales tax (GST) is zero for all petroleum products, the government charges Rs 79.50 per liter for diesel and Rs 80.52 per liter for petrol and high-octane products on account of petrol tax and climate support tax.
It also charges Rs 17-18 per liter customs duty on petrol and HSD, irrespective of its local production or imports. Additionally, around Rs 17 per liter of distribution and sales margins will go to oil companies and their distributors. Gasoline and HSD dominate consumption with between 700,000 and 800,000 tons per month, compared to approximately 10,000 tons for kerosene.
Petroleum tax collection reached Rs 1.161 trillion in FY25 and is projected to rise by around 27 percent to Rs 1.47 trillion in the current fiscal year.
