Senate panel to expose fuel price hike beneficiaries

ISLAMABAD: Amid a zero-bid response to spot tenders for oil imports and the oil industry’s demand for special permission for unusual war-risk insurance cover-based oil imports, including crude and refined products, a parliamentary panel on Monday decided to investigate whether the recent 20pc increase in petroleum prices benefited the exchequer or resulted in unreasonable inventory gains for private companies.

Also, the oil industry in the prevailing extraordinary market conditions demanded that district administrations stop high-handed actions against retail outlets that temporarily run out of stocks. Such actions, reportedly taken under the prime minister’s instructions to curb malpractices, were counterproductive and aggravating supply disruptions.

On the other hand, the government’s recent decision to increase petroleum prices despite the availability of existing stocks drew attention of the Senate Standing Committee on Economic Affairs.

Headed by Senator Saifullah Abro, the parliamentar panel expressed serious concern over the 20pc price hike and questioned the rationale behind the move and the burden it placed on the public, particularly low-income groups.

Mr Abro directed the petroleum division to provide complete details of oil marketing companies (OMCs) to determine whether the benefit of the price increase accrued to the government or to the OMCs.

Earlier, in a letter to various federal government entities, the Oil Companies Advisory Council (OCAC) said, “In the prevailing circumstances, obtaining adequate marine and war-risk insurance cover has become extremely difficult. This challenge was recently reflected in the Pakistan State Oil (PSO) spot tender floated on the Gallop platform on a C&F basis, where no bids were received for MS, HSD and JP-1 cargoes.”

In view of the constraints in arranging insurance under C&F terms, the OCAC proposed that imports be temporarily allowed on a CIF (Cost, Insurance and Freight) basis instead of the current Cost and Freight (C&F) arrangement. The special permission for unusual war-risk insurance-cover-based imports should cover all oil imports, including crude, refined products and associated materials, to ensure a smooth supply chain in extremely volatile circumstances.

In the letter to the State Bank of Pakistan (SBP), the ministers for finance and petroleum, and the chairman of the Oil and Gas Regulatory Authority (Ogra), OCAC Secretary General Dr Syed Nazir Abbas said that due to the rapidly evolving geopolitical situation in the Middle East, international oil and shipping markets had become extremely volatile. Freight rates, insurance costs and the availability of vessels had been severely affected, he wrote.

Mr Abbas pointed out marine insurers had either withdrawn or sharply increased war-risk coverage for ships operating in the Persian Gulf and the Strait of Hormuz due to the ongoing Iran-Israel-US conflict.

“Freight rates for vessels operating in the Gulf region have reportedly increased by almost fourfold, while war-risk insurance premiums for Gulf voyages have surged dramatically, making tanker chartering extremely difficult and expensive,” he said. Under the current regulatory framework, refineries and oil marketing companies (OMCs) are required to import petroleum products on a C&F (Cost and Freight) basis, under which the supplier arranges and pays for freight up to the destination port, while the buyer is responsible for arranging and bearing the cost of product insurance, including any war-risk coverage.

According to the SBP Foreign Exchange Manual (Chapter 13 — Imports), approval for CIF imports is normally granted on a case-by-case basis. However, given the exceptional circumstances and the potential risk to national fuel supply, the OCAC requested a temporary general allowance for petroleum cargoes, including crude oil, refined petroleum products, base oil and allied materials, for a period of up to two months.

Published in Dawn, March 10th, 2026

‘Petrol bomb’ falls on Pakistan amid war

Strait of Hormuz crisis triggers cost surge fears

Iran war shakes up global shipping routes due to Strait of Hormuz paralysis

Fatima Fertilizer launches Sarsabz Tabeer: Seeds of Change campaign on International Women’s Day to celebrate women in agriculture

Women in Thar: Breaking barriers, transforming lives

ParkView City homebuyers can now avail UBL Home Financing

India crush New Zealand to win third T20 World Cup title

‘Whole country will stop’ as India dreams of home World Cup glory

Mojtaba Khamenei’s appointment as supreme leader draws measured US response, sharp Israeli warning

Kutchery Chowk flyovers, underpasses in Rawalpindi set to open for traffic before Eid

Brace for impact: The Middle East war has reached Pakistan

Pakistani found guilty of ‘Iran-linked plot to kill Trump’

PM Shehbaz to announce austerity plan tomorrow amid global fuel crisis

What can end the Iran war?

Pakistan signals support to Saudi Arabia while treading carefully with Iran amid Gulf escalation

Senate panel to expose fuel price hike beneficiaries

Trump says Iran war ‘pretty much’ over, progressing ahead of schedule

Islamabad police release Aurat March activists a day after detention; probe demanded into ‘manhandling’ of detainees

Higher education goes online, schools shut for 2 weeks, 4-day work week announced as ‘austerity measures’

T20 World Cup: Sahibzada Farhan makes it to ICC’s Team of the Tournament

Pair charged with terrorist offences for throwing explosives near a protest outside New York Mayor Mamdani’s residence

Trump’s reckless gambit

Debating war and policy

LIVE: US President Trump Press Conference

Iran Names New Supreme Leader Amid War Escalation

Manchester City & Chelsea Advance

What Iran’s New Supreme Leader Means for the Country

Global Markets Update: Stocks Slide As Oil Surge Fuels War Fears

Middle East Update: Iran Strikes Continue, Israel Expands Operations

Pakistan Update: Stock Market Halted As Iran War Shakes Economy

‘Petrol bomb’ falls on Pakistan amid war

India crush New Zealand to win third T20 World Cup title

© Dawn Business