Petrol prices in Pakistan could be reduced by Rs15 per litre under a revised petroleum pricing mechanism, Federal Petroleum Minister Ali Pervaiz Malik has announced.
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Speaking at a press conference in Islamabad alongside the Information Minister, Malik said the government was working with local oil refineries to provide relief to consumers amid difficult economic conditions.
The minister said petrol prices were scheduled to increase by Rs15 per litre on Friday, but the proposed increase was avoided with the cooperation of local refineries.
According to Malik, oil refineries have shared a financial burden of Rs15 billion with the government to help prevent the price increase. He added that local refineries produce around 30% of Pakistan’s petrol and have earned substantial profits.
The proposed arrangement could place a monthly financial burden of Rs15 billion on refineries, he said. Further discussions with refinery representatives were scheduled for the following day.
Government Introduces New Petroleum Pricing Formula
The government has revised the mechanism for determining petroleum product prices amid tensions involving Iran and the United States.
According to sources, the Petroleum Division issued a revised pricing formula to oil refineries following cabinet approval.
Under the new mechanism, the import price of petrol will be calculated using the actual cost of Pakistan State Oil’s (PSO) imported cargo.
If the actual import cost is unavailable, the premium and additional expenses associated with the last imported cargo may be used to determine the price.
Media reports said refineries would be allowed to maintain petrol prices at the level applicable on March 7, 2026, for the next 30 days. Premiums, additional expenses and customs duties would also remain at the levels applicable on that date.
Petroleum Levy Adjustment to Benefit Consumers
Under the revised formula, the difference between the import price and the ex-refinery price will be deposited by refineries under the petroleum levy.
Media reports stated that any adjustment in the petroleum levy would be used exclusively to benefit petrol consumers and passed on through a reduction in prices.
The Petroleum Division has also sent official letters to all oil refineries, directing them to submit daily petrol sales figures to the division and the Oil and Gas Regulatory Authority (OGRA).
Refineries will be required to provide daily sales reports, Cost and Purchase Records (CPRs), and payment challans.
OGRA and the Petroleum Division will verify additional levy payments and related financial records to monitor compliance with the revised mechanism.
Pakistan Changes Fuel Price Revision Schedule
Before the Iran conflict, petroleum prices in Pakistan were generally revised every 15 days.
Following the outbreak of the conflict on February 28, 2026, the government shifted to a weekly price revision schedule. The mechanism was subsequently changed to daily price revisions, which remains in effect.
The proposed Rs15 per litre reduction is subject to the government’s pricing mechanism and arrangements with local refineries. The minister’s announcement does not, by itself, confirm a final reduction in the retail price of petrol.
