Pakistan is moving towards a new system for setting petrol prices, under which oil marketing companies could have a greater role in deciding retail rates. The government is currently considering June 2027 as the target for petrol price deregulation.
The Petroleum Pricing Committee reviewed the proposed changes on September 3 and recommended a gradual move towards market based pricing. The committee’s recommendations will now be presented to Prime Minister Shehbaz Sharif for approval. Under the proposed system, petrol prices would be influenced more by market conditions, international oil prices, supply, demand, and other costs.
The committee also approved changes to the method used to calculate the Inland Freight Equalization Margin (IFEM), which covers the cost of transporting petroleum products across Pakistan.
The government has said the reforms aim to increase competition and improve transparency in the petroleum sector. The shift is expected to happen gradually before full deregulation.
