What happened
The federal government announced on Friday 29 May 2026 that it was cutting the ex-depot prices of petrol and high-speed diesel (HSD) by Rs22 per litre each, with immediate effect for the week ending 5 June.
Petrol was set at Rs381.78 per litre and HSD at Rs380.78 per litre. Dawn reported that both products had been priced at Rs403.78 and Rs402.78 respectively in the preceding week, and that the government raised the petroleum levy on HSD by Rs11 per litre while leaving the levy on petrol unchanged at about Rs103 per litre.
It was the third consecutive weekly reduction in petroleum prices. Dawn put the cumulative reduction over the three revisions at about Rs33 per litre, and noted that the HSD price had fallen from a peak of Rs520.35 per litre recorded on 10 April. The cut followed a Rs5 per litre reduction for the week starting 16 May.
The price cut was announced as Pakistan marked the third day of Eid-ul-Azha. Prime Minister Muhammad Shehbaz Sharif called the reduction a fulfilment of his earlier commitment to pass on any available fiscal space to the public and described it as a special Eid gift, according to the Prime Minister’s Office statement carried by Dawn.
Why it matters
Officials and analysts expected the lower pump prices to ease transportation costs and feed into inflation, particularly in the transport and food sectors, while improving market sentiment over the Eid period.
Prime Minister Shehbaz said the government had absorbed more than Rs130 billion in subsidies during the peak of the global oil crisis rather than passing the entire increase on to consumers, and had introduced targeted fuel subsidies for public transport, goods transport, motorcyclists and rickshaw drivers. He said Pakistan had maintained uninterrupted fuel supplies while some countries in the region faced shortages and queues at filling stations.
The reduction was made possible by falling international crude prices. Dawn reported that Brent crude for July delivery was down about 2 per cent on Friday and had dropped roughly 11 per cent over the week, its steepest weekly decline in seven, after reports that the United States and Iran had agreed a potential ceasefire extension. The more active August contract traded near $90.81 a barrel and West Texas Intermediate near $87.20.
Before the conflict with Iran that began on 28 February 2026, Dawn noted, petrol and diesel in Pakistan had been priced at around Rs266 and Rs281 per litre.
