Pakistan to revise petrol, diesel prices daily as West Asia conflict fuels oil market volatility

Pakistan on Friday announced that petrol and diesel prices will now be revised every day, replacing the existing weekly mechanism, as the government seeks to respond more quickly to volatile global oil markets amid the continuing conflict in West Asia.

Petroleum Minister Ali Pervaiz Malik, addressing a joint press conference with Information Minister Attaullah Tarar, said the federal cabinet had approved a new pricing mechanism under which the Oil and Gas Regulatory Authority (OGRA) will determine fuel prices on a daily basis.

According to Malik, OGRA will not only publish the revised fuel prices on its website each day but will also disclose the calculations and factors used to determine the rates charged at petrol stations.

The government had shifted from a fortnightly to a weekly pricing system following the outbreak of the US-Iran conflict in late February. However, the weekly revision mechanism drew criticism over delays in passing on the benefits of falling international oil prices to consumers.

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Malik, in his remarks, said the step was part of the government’s decision to make the system more transparent, so that people could understand why increasing fuel prices were inevitable.

He said the daily price announcements will be decided according to a seven-day weekly average in the international market. He added that in another step towards deregulation, prices in the country would be adjusted according to international markets without needing to consult anyone.

Malik also highlighted steps taken by the government to increase energy extraction. He noted that after Prime Minister Shehbaz Sharif’s recent visit to Turkiye, Turkish Petroleum — the West Asian nation’s national oil and gas company — will be coming in October to extract oil and gas in Pakistan after a gap of 20 years.

Information Minister Tarar said that the increase in oil prices in international markets was linked to the worsening regional situation and that Pakistan’s efforts to resolve the situation had been “appreciated by the entire world”.

Meanwhile, the All Pakistan Petrol Pump Owners’ Association rejected the proposed price deregulation policy, warning that it would consider protesting and striking against it next week if the policy was not withdrawn.

The association’s vice chairman, Noman Ali Butt, said that the government should review its policy and not place the burden of its problems on petrol pump owners.

“All stakeholders should be taken into confidence before fixing rates with oil marketing companies,” he said in a video statement.

He said that about 15,000 petrol pump owners across the country had serious concerns about it. Asserting that the new policy would affect oil tankers, transportation and the pricing system, he demanded consultation with the petrol pump owners on the issue.

With inputs from agencies