Karachi: An economic reform to shift petroleum prices from a weekly to a daily determination system in Pakistan has been proposed but should not proceed without transparency and significant consultation, according to Mian Zahid Hussain, President of the Pakistan Businessmen and Intellectuals Forum. According to the Forum, this shift aims to reduce political intervention and quickly adapt to international oil market changes. The Oil and Gas Regulatory Authority (OGRA) plans to publish daily price data, which will include various elements such as the Inland Freight Equalisation Margin and stock management.
The proposed reform, as outlined by Hussain, must be carefully finalized before implementation due to its direct impact on transport, agriculture, industry, and household expenses. Recent price hikes demonstrate potential risks, with petrol increasing by Rs. 5.44 per litre and high-speed diesel by Rs. 31.05 per litre. These changes are expected to raise freight charges and agricultural and industrial costs significantly, given diesel's widespread use in transport and equipment.
The Sensitive Price Indicator has already increased by 1.40 percent, reaching 357.61, with the full impact of the diesel price hike yet to be seen in essential goods prices. The Oil Companies Advisory Council has welcomed daily pricing as a step towards deregulation, but concerns remain about supply-chain operations and timely data availability. The rapid price changes could create transparency issues if unresolved.
Petrol-pump owners have opposed the policy, warning of potential protests and disruptions. They argue that daily revisions could cause losses on existing stocks and administrative issues across 15,000 outlets. Hussain emphasized that the credibility of the system hinges on whether price changes are promptly and equally passed to consumers.
Hussain proposed forming a broad-based committee to oversee the pricing framework and ensure uniform implementation and stock value adjustments. While daily pricing could enhance transparency, it should not lead to daily uncertainty for businesses and consumers. The government is urged to secure consensus, ensure supply continuity, and guarantee that price reductions are implemented as swiftly as increases.