Federal Government comes up with a new method to determine the prices of petroleum products
Pakistan State Oil (PSO) has been removed as the import price benchmark for fixing the prices of petroleum products in Pakistan.
The Federal Government has come up with a new method to fix the prices of petroleum products. The latest development states that prices will be revised every 15 days instead of every month.
This new method of determining prices is very likely to result in more frequent price hikes and drops. Various factors like fuel shortage, exchange rate fluctuation, and more are expected to affect the new petroleum price.
The Directorate General Petroleum Division of the Federal Ministry of Energy has issued a letter stating the new pricing method for petroleum products to the Oil and Gas Regulatory Authority (OGRA) and the Oil Companies Advisory Council.
As per details, the new pricing method for petroleum products shall be made effective from the 1st of September 2020.
The letter states that:
Pakistan State Oil (PSO) has been removed as the import price benchmark for fixing the prices of petroleum products in Pakistan. The Arab Gulf Pellets will be the new benchmark for determining petroleum prices, while the average cost of petroleum will be determined through PSO and Arab Gulf Pellets.
The Ministry of Energy said:
Any fluctuation in the exchange rate within the next 15 days would be reflected in the new petroleum price. PSO would be signing a long-term agreement to purchase petrol, just as they did for diesel. The purpose of this long-term petrol deal is to obtain fuel at a cheaper rate.
What are your thoughts on this? Please share with us in the comment section below.