The federal government is preparing to deregulate petrol and diesel prices as it expects the Economic Coordination Committee (ECC) to approve the long-awaited refinery upgrade policy by July 15, Petroleum Minister Ali Pervaiz Malik announced on Tuesday.
While briefing the National Assembly Standing Committee on Petroleum, the minister said the refinery upgrade policy has already been submitted to the federal cabinet. Once approved, it will enable local refineries to modernize their operations and produce cleaner Euro-V standard fuels.
Malik said the government is gradually reducing its involvement in setting petroleum prices and transitioning toward a market-based pricing system. He noted that fuel prices have been announced through a transparent mechanism for the past two decades and that the next step is to move toward full deregulation.
The petroleum minister assured lawmakers that consumers would not be forced to bear the cost of refinery inefficiencies. He said the government remains committed to protecting the public from unnecessary increases in fuel prices.
Addressing concerns over high domestic fuel prices despite lower global crude oil prices, Malik explained that Pakistan imports nearly 70 percent of its petrol and about one-third of its diesel requirements. He said refining charges, insurance costs, and shipping expenses continue to keep imported petroleum products expensive.
He further stated that while international crude oil prices have largely returned to pre-conflict levels, prices of refined petroleum products have declined more slowly. Although petroleum levy and carbon levy rates remain below the levels imposed on February 27, the cost of imported fuel continues to limit reductions in local fuel prices.
During the committee meeting, lawmakers also expressed concerns about the implementation of official LPG pricing and the use of corporate social responsibility (CSR) funds by petroleum companies. The committee directed the Petroleum Division to submit detailed information on the utilization of billions of rupees in unspent CSR funds allocated for projects in Sindh and Balochistan.
