ISLAMABAD, Pakistan: The federal government is targeting June 2027 for petrol price deregulation. This plan shifts towards competitive market-based pricing while retaining safeguards against sharp price volatility.
The Petroleum Pricing Committee, chaired by Federal Minister for Petroleum Ali Pervaiz Malik, agreed on the timeline at its September 3 meeting. Its final recommendations will be submitted to Prime Minister Shehbaz Sharif for consideration and approval.
The committee also approved principles allowing rules-based intervention in high-speed diesel pricing during emergencies. These would include defined price-shock triggers and specified corrective measures rather than ad hoc intervention.
For petrol, the committee reviewed revisions to the existing pricing formula as part of a gradual transition towards deregulation. The Petroleum Division described June 2027 as a likely target, meaning the timetable is not yet a final approved deadline.
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The committee also approved a revised methodology for calculating the Inland Freight Equalisation Margin (IFEM). Furthermore, the Oil and Gas Regulatory Authority (OGRA) said its audit of the FY2025-26 IFEM would be completed by the end of calendar year 2026.
OGRA was directed to recommend measures to improve the performance and consolidate existing oil marketing companies. This includes greater adoption of international best practices and modern technology.
The committee reviewed proposals for a petroleum price stabilisation fund. However, it said maintaining adequate fuel reserves would be more appropriate as Pakistan moves towards deregulation.
A subcommittee headed by Naeem Ghauri will also engage the Federal Board of Revenue (FBR). The subcommittee will determine whether petroleum-sector taxation should be revised as market conditions change.
