The federal government has established the Petroleum Prices Stabilisation Fund as part of its efforts to better manage fluctuations in petroleum product prices and improve the country’s fuel pricing mechanism. The initiative is intended to help address the financial impact of volatile international oil markets while ensuring a more structured approach to petroleum price management.
The Ministry of Finance has formally notified all relevant government institutions about the creation of the fund, including the Auditor General of Pakistan, the Controller General of Accounts, and the Accountant General Pakistan Revenues.
Provincial Governments Directed to Complete Arrangements
According to the official notification, the Accountant Generals of Punjab, Sindh, Khyber Pakhtunkhwa, and Balochistan have also been informed about the establishment of the fund. Provincial governments have been instructed to complete the necessary administrative arrangements for the collection of contributions related to the fund.
All money deposited under the Petroleum Prices Stabilisation Fund will be transferred to the Public Account of the Federation, ensuring centralized financial management. A dedicated account head and object code have also been created to facilitate transparent accounting and monitoring of the fund.
Rules to Be Developed Jointly
The Ministry of Finance stated that the operational framework and regulations governing the fund will be prepared jointly by the Finance Ministry, the Petroleum Division, and the Oil and Gas Regulatory Authority (OGRA). The framework will take into account all applicable legal, financial, and regulatory requirements.
The ministry added that any additional approvals required for implementing the mechanism will be obtained separately once the operational details are finalized.
Move Follows Recent Fuel Price Decisions
The establishment of the stabilisation fund comes shortly after the government’s latest fortnightly review, in which petrol and high-speed diesel (HSD) prices were left unchanged despite continued fluctuations in international crude oil markets.
However, according to Petroleum Division sources, the government increased the petroleum levy on high-speed diesel by Rs6.57 per litre, raising it from Rs72.97 to Rs79.54 per litre. The petroleum levy on petrol was also increased by 39 paisas, from Rs66.25 to Rs66.64 per litre, while the levy on kerosene remained unchanged at Rs20.36 per litre.
Petrol and Diesel Prices Still Include 29% Tax Despite Major Reduction
Earlier Price Cuts Reflected Falling Global Oil Prices
The government’s latest policy follows a significant reduction in fuel prices during the previous review. Petrol prices were cut by Rs74 per litre, high-speed diesel by Rs67 per litre, and kerosene by Rs48.29 per litre after international crude oil prices declined.
The reduction came as global energy markets stabilized following the reported US-Iran peace agreement and the reopening of the Strait of Hormuz, developments that eased concerns over disruptions to global oil supplies. Since Pakistan imports a substantial portion of its petroleum requirements, movements in international crude oil prices directly influence domestic fuel pricing.
Government Promises Transparency and Consumer Protection
Following the latest fuel pricing decisions, Federal Minister for Petroleum Ali Pervaiz Malik said consumers could receive further relief if international market conditions remain favourable.
He noted that a high-level committee, constituted on the directives of Prime Minister Shehbaz Sharif, would oversee petroleum price determination to improve transparency and ensure that pricing decisions are made in the public interest.
The minister said the government is closely monitoring developments in global energy markets and remains committed to passing on any available relief to consumers while honouring Pakistan’s international financial commitments. He emphasized that the government intends to maintain a balanced approach, avoiding undue financial pressure on any particular sector while keeping consumer welfare at the forefront of its policy decisions.
