ISLAMABAD: A meeting of the Committee on Petroleum Pricing, led by Federal Minister for Petroleum Ali Pervaiz Malik, was held to evaluate the current petroleum pricing framework and discuss steps to enhance transparency and predictability in fuel pricing while safeguarding consumers from excessive price volatility.

According to Press Information Department, the Committee reached a consensus on recommendations aimed at reinforcing the existing pricing mechanism. It was decided that a final report on these recommendations would be submitted to the Prime Minister for approval in the near future.

For diesel pricing, the Committee endorsed principles for potential rules-based intervention during emergency situations, with defined triggers for price shocks and corrective measures. The Committee also examined the petrol pricing formula and set a tentative target of June 2027 for the deregulation of petrol, aiming for a gradual shift towards market-based pricing while protecting consumers from undue price fluctuations.

The meeting included a review of the current Inland Freight Equalization Margin (IFEM) mechanism, agreeing on a revised calculation methodology. The Oil and Gas Regulatory Authority (OGRA) committed to completing the IFEM audit for the fiscal year 2026 by the end of the calendar year 2026.

Further directives were given to OGRA to submit written recommendations on the consolidation and performance of existing Oil Marketing Companies (OMCs), focusing on the adoption of best practices and new technologies. The Committee also assessed subcommittee reports on a price stabilization fund, benchmarking them against various global models, and concluded that maintaining adequate fuel reserves would be more suitable than establishing a stabilization fund in view of future market deregulation.

The Committee’s recommendations are designed to enhance predictability and transparency in petroleum pricing, improve market efficiency, and protect consumers from sudden price changes, as Pakistan transitions towards deregulation. A subcommittee led by Mr. Naeem Ghauri is set to meet with the Chairman of the Federal Board of Revenue to evaluate if the taxation regime requires adjustments due to evolving market conditions.

The meeting saw participation from committee members including National Coordinator NCMC, Mr. Zahid Mir, and Mir Naeem Ghauri, along with representatives from OGRA, FBR, the Finance Division, KPMG, and Petroleum Division officials.