The government is likely to raise the prices of both high-speed diesel (HSD) and petrol by up to Rs100 per liter by increasing the petroleum levy to meet new IMF conditions.
In April 2026, the government substantially increased the petroleum levy on petrol to over Rs107 per liter, fueling public concern amid rising inflation. These hikes, sometimes exceeding Rs50 at a time, are part of efforts to meet IMF-driven fiscal targets. As a result, total petroleum levy collections have surpassed Rs1.2 trillion during the first nine months of the fiscal year.
By late April 2026, the levy on petrol had crossed Rs107 per liter. Earlier in the month, it was raised by more than Rs55, pushing it to record levels and substantially impacting fuel prices.
Overall, the total tax burden on petrol, including the levy, customs duties, and climate-related charges, has climbed to nearly Rs134 per liter.
Last Friday, the government increased the prices of both HSD and petrol by Rs26.77 per liter, even though there was no apparent need to raise petrol prices.
Following the hike, the price of HSD reached Rs380.19 per liter, up from Rs353.42, an increase of 7.5%. However, diesel prices remain well below their peak of Rs520.4 recorded on April 10.
