ISLAMABAD: The federal government has reduced the petroleum levy burden on petrol consumers by Rs1.65 per litre under a revised pricing mechanism effective November 12.

The change lowers the levy component attributed directly to consumers from Rs65.29 to Rs63.64 per litre. Oil refineries will now bear the remaining Rs16.36 per litre under the revised arrangement.

Despite the adjustment, the total petroleum levy on petrol remains unchanged at Rs80 per litre. The government will continue collecting the same overall amount through the revised distribution mechanism.

The Ministry of Energy’s Petroleum Division issued a notification on November 11, confirming the new rates. The notification applies from November 12 until further orders.

Under the previous arrangement, consumers were assigned Rs65.29 per litre, while refineries covered Rs14.71. The revised formula increases the refinery contribution to Rs16.36 per litre.

This shifts an additional Rs1.65 per litre of the levy burden away from consumers. The government’s overall petroleum levy collection, however, remains at Rs80 per litre.

The adjustment applies to motor gasoline, commonly known as petrol. The notification maintains the petroleum levy on high-speed diesel at Rs80 per litre, with no refinery differential listed for the product.

The latest change is part of the government’s revised petroleum pricing mechanism. It aims to provide some relief to petrol consumers while maintaining the federal government’s levy revenue.

However, the reduction in the consumer levy component should not automatically be interpreted as a Rs1.65 cut in petrol pump prices. Retail fuel prices depend on several other components, including fuel costs, transportation margins and applicable charges.

Therefore, the confirmed development concerns the distribution of the petroleum levy rather than a separate announcement of a retail price reduction.

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The revised arrangement changes how the existing levy is allocated between consumers and refineries. The total government levy on petrol remains Rs80 per litre.