OCAC seeks consistency in fuel pricing policies, immediate notification of Rs 1.22/ litre margin increase

ISLAMABAD: The Oil Companies Advisory Council (OCAC) has called on the government to ensure consistency in fuel pricing policies and immediately notify the pending Rs1.22 per litre increase in margins of oil marketing companies (OMCs).
In a letter to Petroleum Minister Ali Pervaiz Malik, the OCAC chairman expressed deep concern over repeated changes to the High-Speed Diesel (HSD) pricing mechanism in recent months, the latest of which was introduced on August 20, 2026.
The OCAC also referred to reports that the government is contemplating another intervention in the HSD pricing mechanism. According to the industry, the proposed measure would reduce the HSD crack ceiling from $41.89 per barrel to $30 per barrel, potentially resulting in a further reduction of around Rs18-20 per litre in the HSD price.
According to OMCs, the existing HSD pricing mechanism does not reflect the premium currently prevailing in the market. The Aramco premium for October stands at minus $2 per barrel, which is the same premium reflected in the existing HSD pricing formula, whereas cargoes are reportedly being offered and booked at premiums ranging between $15 and $20 per barrel.
The industry said this was creating significant challenges for refineries in booking October cargoes, warning that any abrupt reduction in the HSD price could make the booking of high-premium cargoes uneconomical.
“This could force refineries to reduce throughput instead of increasing it in anticipation of seasonal demand,” the OCAC chairman said.
The industry further argued that it had consistently supported the government during challenging periods and could not reasonably be expected to repeatedly absorb the financial cost of policy interventions.
The OCAC noted that the refining sector was simultaneously preparing to invest approximately $5-6 billion in refinery upgradation projects under the Brownfield Refining Policy.
“Investments of this magnitude require policy consistency, pricing predictability and financial stability,” the industry said in its letter to the Petroleum Minister.
The OCAC chairman also pointed out that OMC margins were last revised in September 2023 and had remained unchanged despite persistent inflation, rising operating and compliance costs, and increasing regulatory obligations.
“Considering the prolonged delay, we again request the immediate notification and implementation of the pending Rs1.22 per litre increase in OMC margin,” the chairman said.
The industry urged the Petroleum Minister to ensure consistency and continuity in the fuel pricing formula, stating that a stable and predictable pricing mechanism was essential for the sustainable operation and investment planning of the downstream oil sector. Ends