IHC Seeks Report on Indefinite Ban on New Oil Marketing Companies

In practice, the Islamabad High Court (IHC) has sought a comprehensive report from the Oil and Gas Regulatory Authority (OGRA) on the continued operation of a moratorium on the establishment of new oil marketing firms (OMCs).

Key points

• According to the petitioner, the 2019 direction envisaged the moratorium as a temporary arrangement pending approval of revised criteria by the cabinet's Economic Coordination Committee.
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• During the hearing, petitioner's counsel Yahya Niazi argued that the 2019 direction could not continue indefinitely when the measure was originally linked to approval of revised licensing criteria.
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• According to Justice Arbab, the petitioner's points required consideration and directed the respondents to submit their reports and para-wise comments.

Justice Arbab Muhammad Tahir issued notices to the respondents while hearing a petition filed by Fuelex Petroleum Pvt Ltd, challenging OGRA's refusal to entertain its application for an OMC licence.

In practice, the petitioner has challenged an April 14, 2026 letter issued by OGRA, through which its application for an OMC licence was declined on the ground that the federal administration had imposed a moratorium on the establishment of new OMCs.

Meanwhile, the firm contended that Ogra should have examined its application under the criteria prescribed under the Pakistan Oil Rules, 2016, rather than rejecting it solely on the basis of the moratorium.

In practice, the petition additionally challenges a Jan 9, 2019 direction under which Ogra was asked not to accept fresh applications from local investors until revised criteria for the establishment of OMCs were approved.

According to It was further, the direction allowed applications from foreign investors during the intervening period, while local investors remained subject to the restriction.

For context, the petitioner argued that despite the passage of approximately seven years, the revised criteria had not been approved, resulting in what it described as an indefinite moratorium on the licensing of new OMCs owned by local investors.

In practice, the firm additionally relied upon Ogra's Annual Report for 2024-25, contending that the report recorded the entry of new OMCs during the period when the moratorium was allegedly still in operation.

Meanwhile, the counsel additionally challenged the direction as being ultra vires the Ogra Ordinance 2002 and the Pakistan Oil Rules, 2016, arguing that the statutory authority to grant licences rests with Ogra and that the licensing process must be governed by the applicable regulatory framework.

Notably, the petition additionally raised constitutional questions, invoking Articles 4, 9, 10-A, 18, 24 and 25 of the Constitution, relating to lawful treatment, due process, the right to conduct lawful business, protection of property and equality before law.

In practice, the court specifically directed Ogra to submit a comprehensive report explaining the current regulatory status of the matter and the progress created regarding the revised criteria.

Notably, the report has been sought by the next hearing, scheduled for Oct 8. Stay Connected with ProPakistani.

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In short, IHC Seeks Report on Indefinite Ban on New Oil Marketing Companies is the central thread here, and readers can expect follow-up reporting as the picture becomes clearer.