By Our Correspondent
ISLAMABAD: The federal government has announced a major overhaul of Pakistan’s petroleum pricing mechanism, under which petrol and diesel prices will be revised on a daily basis instead of the existing fortnightly schedule.The federal government on Friday announced that petrol and diesel prices in Pakistan will now be revised daily under a new pricing mechanism based on the average international oil prices over the preceding week, with the Oil and Gas Regulatory Authority (OGRA) authorised to determine and notify prices without seeking federal approval.
Addressing a joint press conference in Islamabad on Friday, Federal Minister for Petroleum Ali Pervaiz Malik and Federal Minister for Information and Broadcasting Attaullah Tarar said the new system is aimed at making fuel prices more responsive to fluctuations in the international oil market while ensuring greater transparency for consumers.
The ministers said the revised mechanism would calculate average international petroleum prices over a one-week period, after which domestic fuel prices would be adjusted daily based on those trends.
Under the new framework, the Oil and Gas Regulatory Authority (OGRA) will no longer submit summaries to the federal government seeking approval for increases or decreases in petroleum prices, they said. Instead, prices will be determined automatically through a pre-defined formula linked to global market movements.
“The objective is to ensure that the benefit of lower international oil prices reaches consumers without delay, while increases, if any, are also reflected in a transparent manner,” the petroleum minister said.
The ministers said the existing system of revising fuel prices every 15 days often created a gap between domestic and international prices, leading to distortions in the market. The proposed daily adjustment mechanism is intended to align Pakistan’s petroleum pricing more closely with prevailing global rates.
Information Minister Attaullah Tarar said the reform would reduce uncertainty and improve predictability for businesses and consumers by allowing gradual adjustments instead of sharp price changes every two weeks.
He added that the government remains committed to maintaining transparency in the petroleum pricing process and ensuring that any changes are made strictly in accordance with the approved formula.
Officials said the average international prices recorded during the preceding week would serve as the benchmark for calculating daily domestic fuel prices.
The ministers did not specify the exact implementation date but indicated that the new pricing system would come into effect after the completion of necessary administrative and technical arrangements.
The announcement marks one of the most significant changes to Pakistan’s petroleum pricing framework in recent years. Analysts say a daily pricing mechanism could bring domestic fuel prices closer to international market trends, although its impact on inflation and consumer spending will depend on the direction of global crude oil prices and exchange rate movements.
The government is expected to issue detailed guidelines on the operational framework of the new pricing mechanism in the coming days.
