The federal government on Friday approved a 15.5 per cent increase in the margins of petroleum dealers on petrol and high-speed diesel, averting a nationwide strike planned by dealers from Saturday.
The Economic Coordination Committee (ECC) of the federal cabinet approved an increase of Rs1.34 per litre, raising the dealers’ margin from Rs8.64 to Rs9.98 per litre. The revised margin will take effect from Sept 1.
Finance Minister Muhammad Aurangzeb chaired the ECC meeting virtually, while Finance Secretary Imdadullah Bosal attended the meeting in person at the Finance Division. The meeting was convened on a public holiday after petroleum dealers announced plans for a nationwide strike from Aug 15.
The Finance Division did not disclose the exact increase in its statement, but officials confirmed that the ECC had approved the proposal submitted by the Petroleum Division.
Following the decision, the Pakistan Petroleum Dealers Association (PPDA) withdrew its strike call. The association had earlier issued a 72-hour ultimatum to the government, accusing it of failing to fulfil commitments made by the petroleum minister regarding its demands.
The dealers had sought replacement of the existing fixed margin with a variable margin equivalent to 8 per cent of the retail price of petrol and diesel.
Officials said acceptance of the demand would have increased the dealers’ margin to around Rs26 per litre on petrol and Rs30 per litre on diesel at current retail prices, placing a significant additional burden on consumers.
The ECC instead approved a 15.51pc increase in the fixed margin.
The margin of oil marketing companies (OMCs) will remain unchanged at Rs7.87 per litre for both petrol and diesel. A proposal to increase the OMC margin by Rs1.22 per litre remains subject to the implementation of digitisation measures.
According to the Finance Division, the ECC reviewed a Petroleum Division summary and discussed the revision of dealers’ margins on motor spirit and high-speed diesel.
The latest decision follows a series of developments over dealers’ margins. In December 2025, the ECC had approved an increase of Rs2.56 per litre in dealers’ margins on petrol and diesel. The federal cabinet later modified the decision, prompting the PPDA to demand its implementation.
Dealers subsequently made the shift from fortnightly to daily petroleum price revisions another point of contention and called for their margins to be linked to retail prices. The government, however, retained the daily pricing mechanism.
Under the December 2025 decision, half of the proposed margin increase was to take effect from Dec 15, subject to a declining trend in petroleum prices, while the remaining half was linked to the achievement of digitisation targets set by the Oil and Gas Regulatory Authority (Ogra).
On Dec 23, the federal cabinet modified the decision, making the increase conditional on OMCs and petroleum dealers completing digitisation targets.
With the digitisation process still ongoing, Petroleum Minister Ali Pervaiz Malik met representatives of the All Pakistan Petrol Pump Owners Association and the PPDA on July 22 following an earlier strike call. Senior Petroleum Division officials and the Ogra chairman also attended the meeting.
The dealers urged the government to separate the increase in their margins from digitisation, arguing that the implementation of the initiative was primarily the responsibility of OMCs.
They also renewed their demand to replace the fixed margin of Rs8.64 per litre with a margin equivalent to 8pc of the retail price of petrol and diesel.
