The Telecom Bill Pakistan Needs to Actually Debate
June 22, 2026
Pakistan’s oil industry has criticised the government’s latest petroleum price reduction, warning that repeated changes to the pricing mechanism could result in losses of up to Rs105 billion for refineries and oil marketing companies.
Pakistan’s oil industry has raised concerns over the government’s recent reduction in petroleum prices, warning that the move could inflict losses of approximately Rs105 billion on refineries and oil marketing companies (OMCs) due to what it describes as repeated and unilateral changes to the pricing mechanism.
According to Profit by Pakistan Today, Dawn, and Business Recorder, the Oil Companies’ Advisory Council (OCAC), which represents more than three dozen refineries and OMCs, has formally protested the decision, arguing that it was implemented without industry consultation and has created significant financial exposure for downstream petroleum companies.
In its communication to the government, the council stated that the latest reduction was introduced by once again altering the pricing formula, resulting in substantial inventory-related losses for the sector.
OCAC estimated that the decision would “erode around Rs104 billion in value across refineries and oil marketing companies” based on industry stocks of approximately 505,000 tonnes of petrol and 655,000 tonnes of high-speed diesel.
The council warned that these losses would directly affect “working capital, liquidity and shareholder value” and stressed that they were “not the result of operational inefficiency or market competition but of policy decisions imposed on an already stressed sector.”
Industry representatives also expressed concern over the frequency of changes to the petroleum pricing framework. According to a senior industry executive cited in the reports, the federal cabinet has approved revisions to the pricing mechanism four times within less than three months.
The executive stated that the government initially relied on a 15-day average pricing model when petroleum prices were increasing, later shifted to a weekly average, and has now moved towards crude-based pricing instead of the traditional product import-based pricing system.
He further claimed that “the ex-refinery price of diesel should have fallen by Rs30 per litre“ under the prevailing formula on June 19, but was instead reduced by “Rs81 per litre through a cabinet decision.”
The industry estimates that Pakistan State Oil (PSO) could face losses of around Rs50 billion as a result of the latest adjustment, while Pak-Arab Refinery Company (PARCO) could incur losses of approximately Rs25 billion. Other industry participants could collectively suffer losses of nearly Rs30 billion.
OCAC said it had repeatedly cautioned authorities about the financial consequences of abrupt pricing decisions and increasing policy uncertainty, warning that continued instability could undermine the viability of several market participants and negatively impact the broader petroleum supply chain.
