Government Ends Fuel Subsidies

The government has decided to stop fuel subsidies for motorcyclists, small farmers, and public transport. This decision was made because global fuel prices have fallen sharply.

The move follows recent reductions in petroleum prices. Petrol was cut by Rs74 per litre and diesel by Rs67 per litre. Petrol now costs Rs299 per litre and diesel costs Rs311 per litre. International oil prices dropped after the United States and Iran agreed to end a conflict that lasted more than three months.

Committee Meeting and Decision

The decision was taken at the seventh meeting of the National Steering Committee on Fuel Subsidy on June 22, 2026. Deputy Prime Minister and Foreign Minister Senator Mohammad Ishaq Dar chaired the meeting.

The committee reviewed the fuel subsidy rollout for motorcyclists, small farmers, public transport, and goods transport across all provinces, Gilgit-Baltistan, and Azad Jammu and Kashmir.

Noting that global fuel prices had fallen sharply and the benefit had already reached consumers, the committee agreed to end the subsidy with the prime minister's approval.

Future Steps

Deputy Prime Minister Ishaq Dar appreciated the committee's work and coordination between provinces. He directed that lessons from the exercise be documented. He also said gaps in data and delivery should be fixed to strengthen future public service initiatives.

Who Attended the Meeting

The meeting was attended by Special Assistant to the Prime Minister Tariq Bajwa, federal secretaries of petroleum and IT, the governor of the State Bank of Pakistan, and senior representatives from all provinces, Gilgit-Baltistan, and Azad Jammu and Kashmir.

Background of the Subsidy Package

Earlier, global oil prices rose after the US-Iran conflict. The government first decided to absorb the burden but later increased petroleum product prices significantly.

Petrol prices had reached Rs458 per litre in April this year. Days later, the prime minister announced an immediate reduction of Rs80 per litre in the petroleum levy to give relief to the public.

While announcing the relief, the prime minister also launched a fuel subsidy package to protect the public from rising fuel costs caused by tensions in the Gulf region.

Details of the Subsidy Package

Under the package, motorcyclists were to receive a subsidy of Rs100 per litre. Goods transport, public transport, and freight vehicles also received support for one month.

  • Small trucks: Rs70,000 per month
  • Large trucks: Rs80,000 per month
  • Public transport buses: Rs100,000 per month

The initiative also supported small farmers, who received Rs1,500 per acre in assistance.