Pakistan Lowers Fuel Prices and Reintroduces Austerity Measures

The Government of Pakistan reduced petrol and high-speed diesel (HSD) prices effective October 20, 2026. Petrol prices dropped by Rs5.16 per litre to Rs381.14, and HSD prices fell by Rs7.69 per litre to Rs389.27. The Oil and Gas Regulatory Authority implemented these changes following a decline in global crude prices.

These reductions follow a period of extreme volatility and record price peaks earlier in the year, which were triggered by the outbreak of the US-Iran war in February. Despite the current price cuts, the government maintains significant tax collections, charging Rs114 per litre on petrol and Rs100 on diesel.

To manage fuel consumption during ongoing Middle East conflicts, the government reintroduced austerity measures. These include a 9 p.m. market closure and a 50 percent reduction in fuel allocations for official vehicles for a three-month period. Additionally, Prime Minister Shehbaz Sharif announced a relief scheme for users of motorcycles, auto-rickshaws, and small-engine vehicles, while Petroleum Minister Ali Pervaiz Malik stated that fuel prices would be fixed daily due to hostilities between Iran and the United States.