Petrol pump owners have approached Prime Minister Shehbaz Sharif, seeking replacement of the daily petroleum pricing mechanism with a monthly system, warning that frequent price revisions are causing inventory losses, cash flow problems and rising financial pressure on dealers across Pakistan.
The All Pakistan Petrol Pump Owners Association APPPOA, in a letter dated August 29, 2026, directly requested Prime Minister Shehbaz Sharif to intervene and replace the existing daily petroleum pricing mechanism with a monthly pricing cycle.
The letter, signed by APPPOA Vice Chairman Nouman Ali Butt, highlighted what the association described as serious financial and operational difficulties being faced by petroleum dealers and petrol pump owners following the introduction of daily fuel price revisions.
APPPOA acknowledged the government’s objective of making petroleum prices more responsive to international market conditions but maintained that the daily system was creating significant challenges for the retail petroleum sector.
“We appreciate the Government’s objective of making petroleum prices responsive to international market conditions. However, daily price revisions have created significant financial and operational difficulties for petroleum dealers/owners and are making it increasingly difficult to run their businesses sustainably,” APPPOA stated.
The association said the petrol retail business was fundamentally based on inventory, with dealers required to purchase and store petroleum products before selling them to consumers.
It warned that under the daily pricing system, dealers could suffer direct financial losses if the government reduced prices after they had already purchased fuel at a higher rate.
“The petroleum retail business is fundamentally inventory-based. Dealers purchase and store fuel in advance, and under the daily pricing system, a dealer may purchase fuel at a higher price and subsequently be required to sell it at a lower price, resulting in a direct inventory loss,” the letter stated.
According to APPPOA, such losses cannot be recovered through the fixed dealer margin, leaving petrol pump owners exposed to financial risks over which they have little control.
“Such losses cannot be recovered through the fixed per-litre dealer margin,” APPPOA said.
The association further argued that frequent price revisions were creating uncertainty for dealers in managing fuel inventories, cash flows and working capital.
“Frequent price changes also create serious uncertainty in inventory management, cash flow and working capital,” the association stated.
APPPOA pointed out that petrol pump owners had no control over several factors that directly influence petroleum prices, including international oil prices, exchange rate movements, procurement costs and the timing of price revisions.
“Dealers have no control over international oil prices, exchange-rate fluctuations, procurement costs or the timing of price revisions, yet they are exposed to the financial consequences of these changes,” the letter stated.
The association also highlighted the continued increase in operating expenses, saying rising costs were adding to the financial difficulties of petrol pump businesses.
“At the same time, operational costs continue to rise, further reducing the viability of petrol pump businesses,” APPPOA said.
The petrol pump owners also referred to the recent increase in dealer margins and appreciated the government’s decision, but maintained that the higher margin had not resolved the fundamental issue arising from daily price revisions.
“While the recent revision in the dealer margin is appreciated, it does not address the fundamental difficulties created by the daily pricing mechanism,” the association stated.
APPPOA has therefore formally requested Prime Minister Shehbaz Sharif to replace the daily petroleum pricing mechanism with a monthly pricing system.
“In view of the above, APPPOA respectfully requests that the present daily petroleum pricing mechanism be replaced with a monthly pricing mechanism,” the letter stated.
The association maintained that a monthly pricing cycle would not prevent the government from adjusting domestic petroleum prices in line with international market conditions.
Instead, it argued, the system would provide dealers with greater predictability in managing inventories, procurement and cash flows.
“A monthly pricing cycle would continue to allow the Government to adjust prices in accordance with international market conditions while providing dealers with reasonable certainty for inventory, procurement and cash-flow management,” APPPOA said.
The petrol pump owners also sought to make clear that their demand was not aimed at obtaining an additional financial concession from the government or imposing an additional burden on consumers.
“We wish to emphasize that our request is not for any undue concession or additional burden on the Government or consumers,” the association stated.
APPPOA said its objective was to establish a predictable and sustainable pricing mechanism that would allow petroleum dealers to operate their businesses effectively while ensuring uninterrupted fuel supplies to consumers.
“Our sole request is for a predictable and sustainable pricing mechanism that enables petroleum dealers/owners to operate their businesses effectively and continue providing uninterrupted fuel services to the public,” the letter said.
The association specifically sought the prime minister’s intervention and requested directions to the Ministry of Petroleum, the Oil and Gas Regulatory Authority OGRA and other relevant authorities to replace the existing daily system with a monthly pricing mechanism.
“We therefore humbly request your kind intervention and direction to the Ministry of Petroleum, OGRA and other relevant authorities to replace the existing daily pricing mechanism with a monthly petroleum pricing system in the interest of a stable and sustainable petroleum retail sector,” APPPOA stated.
The association expressed hope that Prime Minister Shehbaz Sharif would consider the matter on an urgent basis in the interest of petroleum dealers, consumers and uninterrupted fuel supplies across Pakistan.
The demand comes after the government introduced a daily petroleum pricing mechanism intended to make domestic fuel prices more responsive to movements in international oil prices and other relevant market factors.
However, APPPOA has argued that the frequent revisions have also shifted greater pricing risk onto petrol pump owners, who are required to maintain inventories purchased before subsequent price changes.
Under the system, a reduction in the notified petroleum price can potentially translate into an inventory loss for dealers holding fuel purchased at the previous higher price, while an increase can similarly affect procurement and working capital requirements.
The petrol pump owners have now placed the issue directly before the prime minister and relevant regulatory authorities, seeking a shift from daily to monthly pricing in an effort to provide greater stability and predictability to the petroleum retail sector while maintaining the government’s ability to respond to international market movements.