OGRA to determine petroleum prices on daily basis: minister

Islamabad (Web Desk): The government has decided to make the petroleum pricing system more transparent by authorising the Oil and Gas Regulatory Authority (OGRA) to determine fuel prices on a daily basis in accordance with fluctuations in the international market.

The announcement was made by Minister for Petroleum Ali Pervaiz Malik during a joint press conference with Minister for Information and Broadcasting Attaullah Tarar in Islamabad.

Ali Pervaiz Malik said the decision was approved by Prime Minister Shehbaz Sharif and the federal cabinet to enhance transparency while protecting the government from financial risks associated with fuel price adjustments.

He said OGRA will issue updated petroleum prices every day through its official website based on prevailing international market rates.

Besides the Platts benchmark, the regulator will also publish a detailed breakdown of all elements that contribute to the final retail price at fuel stations, enabling consumers to understand how petroleum prices are calculated and why adjustments become necessary.

The petroleum minister noted that international diesel prices have recently climbed sharply, increasing from nearly 110 dollars to around 140 dollars per barrel under the Platts benchmark.

Petrol prices have also risen from approximately 89 dollars to almost 100 dollars, reflecting another spike in global energy costs.

He said the federal government has allocated Rs130 billion in petroleum subsidies to shield consumers from the impact of rising global oil prices, adding that the subsidy programme remains in place.

Rejecting claims that the government has increased the burden on consumers through petroleum levies, Ali Pervaiz Malik said both the petroleum levy and carbon support levy remain below the levels that existed before the recent regional conflict. He maintained that no additional burden has been imposed on the public beyond Pakistan's international obligations.

He said the government is reducing its direct involvement in fuel price determination by transferring the responsibility to OGRA, creating a transparent mechanism that protects the interests of consumers, the government and the oil industry alike.

Under the new formula, daily petroleum prices will be based on the average Platts benchmark over the previous seven working days. As a result, changes in global fuel prices will automatically be reflected in local prices without requiring government intervention.

Calling the initiative another milestone in the deregulation of Pakistan's petroleum sector, the minister said Prime Minister Shehbaz Sharif has also established a high-level committee under his supervision to prepare long-term energy sector reforms.

He said the committee has already held four meetings and is expected to submit recommendations on energy pricing and Pakistan's future energy security strategy within the next 15 to 20 days.

Ali Pervaiz Malik said the government is also evaluating the establishment of a strategic petroleum reserve with the assistance of internationally recognised consultants.

He added that efforts are underway to encourage commercial oil storage in collaboration with leading international energy firms, while reforms are also being pursued to expand domestic oil and gas exploration, resolve circular debt, modernise oil refineries, overhaul the gas sector, restructure oil marketing companies and strengthen overall energy governance.

The minister further announced that Turkish Petroleum will resume offshore oil and gas exploration in Pakistan this October after a gap of two decades.

He added that energy cooperation is also being expanded with Saudi Aramco, Kuwait Petroleum, QatarEnergy, as well as American and Chinese companies.

Ali Pervaiz Malik said the government's priority is to make decisions that reinforce Pakistan's long-term energy security despite current global challenges.

He warned that Prime Minister Shehbaz Sharif has directed the Federal Investigation Agency (FIA), the Intelligence Bureau (IB) and other law enforcement agencies to take strict action against anyone involved in profiteering in the petroleum sector.

He reiterated the government's commitment to safeguarding the interests of the public.

Speaking at the press conference, Information Minister Attaullah Tarar said the recent rise in international fuel prices was directly linked to regional tensions.

He said Pakistan continues to support efforts aimed at reducing regional tensions and noted that Prime Minister Shehbaz Sharif's peace initiatives have received international recognition.

Tarar also stressed the need for Pakistan to gradually shift towards electric vehicles and electric motorcycles to reduce reliance on imported fuel and minimise the economic impact of fluctuations in global oil prices.