Rs50b extra annual burden on consumers as petrol, diesel dealer margins raised

ISLAMABAD – Petrol and high speed diesel consumers will face an extra Rs50 billion annual burden as the federal cabinet has approved Rs1.34 per liter hike in dealer margins on both the products.

Key points

• The growth will push the dealer margins on both the petrol and HSD to Rs9.98 per liter from the existing Rs8.64 per liter.
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• Nevertheless, with the digitization initiative still not implemented, the petroleum dealers have kicked off pressurizing the administration.

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For context, the growth will push the dealer margins on both the petrol and HSD to Rs9.98 per liter from the existing Rs8.64 per liter. With petrol and HSD consumption at 18.5 billion liters and existing dealer margin of Rs8.64 per liter, consumers at present pay around Rs320 billion as dealer margin annually. The Rs1.34 growth would add roughly Rs50 billion annually, an official source informed The Nation. The consumers will be paying around Rs 370 billion in dealer margin only, the official continued. Notably, on 9th December 2025, the ECC of the Cabinet approved growth in dealer margin. According to the decision, 50% of the growth in the margins was to be effective from 15th December, 2025 contingent upon a decreasing trend in petroleum products costs. The remaining 50% of the proposed growth in the margins was to be implemented subject to OMCs and dealers achieving the digitization targets set by OGRA.

Nevertheless, Cabinet on 23rd December 2025 approved the ECC decision with the modification that 100 percent (rather than 50 percent) of the rise in the margins will be implemented subject to OMCs and dealers achieving the digitization targets set by OGRA. Nevertheless, with the digitization initiative still not implemented, the petroleum dealers have kicked off pressurizing the administration. After a strike call by the petroleum dealers' associations, the minister for petroleum chaired a gathering on 22nd July, 2026 with the representatives of the All-Pakistan Petrol Pump Owners Association and the Pakistan Petroleum Dealers Association. During session, both Petroleum Dealers and Owners Associations demanded that their margins be delinked from implementation of digitization which is primarily the responsibility of the OMCs and that their current fixed margin (Rs 8.64/liter on MS and HSD) be fixed as percentage of consumer costs at the proposed rate of 8% of consumer rates (Rs. 26 to 31/liter). Nevertheless, afterwards both the sides agreed on Rs1.34 per liter growth in dealer margins on petrol and HSD.

For now, rs50b extra annual burden on consumers as petrol, diesel dealer margins raised remains the part of the story worth watching, and further updates are likely as more details are confirmed.