Petroleum Minister Ali Pervaiz Malik on Friday said that fuel prices would now be fixed on a daily basis due to fluctuations in international market prices following renewed hostilities between Iran and the US.

The government has been announcing weekly revisions to fuel prices since early March, alongside measures for the conservation of fuel amid possible oil supply disruptions due to the ongoing conflict in the Middle East. The federal government in April also announced targeted relief measures to provide subsidised fuel.

Addressing a press conference alongside Information Minister Attaullah Tarar, Malik thanked the nation on behalf of the government, who he said have “patiently tried to bear the burden of this war”.

He noted that despite the efforts of Chief of Defence Forces (CDF) and Chief of Army Staff Field Marshal Asim Munir and Prime Minister Shehbaz Sharif, the US-Iran war seemed to be escalating in the region.

The petroleum minister stated that the Cabinet and prime minister had decided to give the Oil and Gas Regulatory Authority (Ogra) the responsibility to decide the fuel prices on a daily basis, based on the international market.

He added that Ogra would “not just publish the fuel rates on its website that are used to determine prices, but also publish the factors leading to the price that we see in each petrol pump”.

Malik stated that although the decision would surely add a burden on citizens, they would see how it was necessary for the state. He said that the decision was part of the government’s decision to make the system more transparent, so that people could understand why increasing fuel prices were inevitable.

He also noted that there had been “a lot of discussion” on the imposition of petroleum and climate levies by the government, and the prime minister’s promise that any price reductions would directly benefit the nation.

“The government is still determined to deliver on its promise,” he said.

He said that the price of diesel dropped from Rs520 to the range of Rs300 today, and similarly a huge price reduction of Rs70-80 was seen for petrol when it happened in the international markets.

He also noted that the petrol levy and the carbon support levy on petrol and diesel were still low today.

The minister said that the government was working on transparency and reducing the burden of indirect taxation.

According to him, the daily price announcements will be decided according to a seven-day weekly average in the international market. He added that in another step towards deregulation, it would be ensured that the prices in the country were adjusted according to the international market without asking him, the information minister “or anyone else”.

Malik highlighted that in efforts towards deregulation, PM Shehbaz had created a committee under the petroleum minister’s leadership, which had already held four meetings.

“In the next 15-20 days, we will decide on post-war energy pricing and energy security architecture, based on which the next generations will assess this government,” he said.

He also raised the question of why Pakistan continued to fulfill its energy requirements through imports, stating that a study commission had been undertaken to make educated decisions through internationally-renowned consultants on whether the government had the resources to keep strategic petroleum reserves.

Other questions, he noted, included how much money the government could commit to this venture over the next few years, and how it could motivate large-scale traders in international markets and companies in “brotherly and neighbouring” countries to keep their reserves with Pakistan and provide them to other markets from here.

This summary will be presented next week in the Cabinet, he said.

Malik also highlighted steps taken by the government to increase energy extraction. He noted that after the prime minister’s recent visit to Turkiye, Turkish Petroleum would be arriving to extract oil and gas in the country in October after 20 years.

“We will move towards betterment so that people will remember this government in good words,” the minister said. “If there are any burdens … we will get through these times using schemes like austerity measures.”

Information Minister Attaullah Tarar also addressed the press conference, saying that the pricing formula for the daily petrol rates would be published formally by Ogra.

“We appreciate that it is not easy,” he said. “That increases in fuel prices impact people. The government understands it.”

The minister stated that the increase in oil prices in international markets was linked to the worsening regional situation and that Pakistan’s efforts to resolve the situation had been “appreciated by the entire world”.

During oil shortages at the peak of tensions, he noted that “many developed countries in the world saw people lining up for fuel and they couldn’t get it”. At the same time, he said, the prime minister had arranged additional oil reserves beforehand.

“Many countries opted for rationing, but in Pakistan, there was no rationing or shortage,” Tarar said. “Whenever the petroleum division gave a briefing, it would announce that we had reserves for one and a half to two months.”

He said that when prices were soaring around the world, the federal government reduced its development budget to provide Rs129 billion worth of subsidies, thus countering the price hikes. This, he said, was “a conscious decision” by the prime minister to ensure that the burden was not transferred to the people.

He also addressed the “misconception” that levies had been hugely increased, saying, “The fact is that the levy is currently lower than pre-war levels, if not equal … There was a special effort to reduce it.”

Tarar also commented that “we, as an economy and as a country, have to move towards electric bikes and electric vehicles. It is inevitable.” He termed this the best solution for the country’s import bill and to mitigate the impacts of rising prices.

Additionally, he challenged the misconception that oil marketing companies had made “huge profits”, pointing out that PM Shehbaz had told investigative departments — including the Federal Investigation Agency (FIA) and regulators — that no one would be allowed to earn extra profits. He added that strict action had been taken “just yesterday” against a company that was found hoarding.

Tarar highlighted the strict regulations against oil companies, adding that Ogra, an independent regulator, had an “honest, upright officer” as its chairman, as well as a new IT-based system on the premier’s recommendation.

“Ogra is doing its work to ensure that there is no extra profitmaking, hoarding or artificial inflation,” he said.

The information minister also encouraged experts and analysts to discuss the pricing formula with the government, noting that “often these debates are very healthy”.

He prayed for the success of Pakistan’s negotiation efforts and a permanent end to the war, adding that “there should be no politics over this”.

“Our priority is to give as much relief to the nation as we can,” he said.

Petrol pump body rejects proposed deregulation

The All Pakistan Petrol Pump Owners’ Association rejected the government’s proposed price deregulation policy, warning that it would consider protesting and striking against the decision next week if it was not withdrawn.

In a video statement, the association’s vice chairman, Noman Ali Butt, said that the government should review its policy and not place the burden of its problems on petrol pump owners.

“All stakeholders should be taken into confidence before fixing rates with oil marketing companies,” he said.

He noted that about 15,000 petrol pump owners across the country are facing serious concerns, and said that the new policy would affect oil tankers, transportation and the pricing system.

“The government should consult petrol pump owners instead of making unilateral decisions,” the vice chairman said.

A renewed escalation in tensions between the United States and Iran, after an interim agreement in June, has once again largely halted traffic through the Strait of Hormuz, the world’s most important shipping route for oil and gas, pushing up global energy prices.

Tehran resumed its blockade of the strait and Washington again blockaded Iranian ports from Wednesday, as last month’s truce descended into daily attacks and counterattacks.

The diesel price has come down from a peak of Rs520.35 recorded on April 3. Its price had started rising from Rs281 per litre after the US-Iran war broke out on February 28.

The petrol price had peaked at Rs458.41 on April 3 after beginning its upward trajectory from Rs266 in the first week of March.

Petrol is mainly used in private transport, small vehicles, rickshaws and two-wheelers, and changes in its price affect the middle and lower-middle classes.

Similarly, changes in diesel prices also impact the public at large, as it is mainly used in the heavy transport sector, power plants and large generators.