PSO Announces Advance Pricing Facility, Shakes Pakistan’s Oil Sector

Islamabad: Pakistan State Oil (PSO) has introduced a major policy shift in the oil sector, triggering strong reactions across the industry.

For the first time, PSO has launched an advance pricing facility, under which the company will absorb losses if fuel prices are reduced after dealers place their orders.

PSO to Bear Losses on Price Cuts

Under the new arrangement, if petrol or diesel prices fall, PSO—not the dealers—will cover the financial loss.

This marks a significant change from past practice, where dealers often suffered losses during price reductions.

Extra Discount for Dealers

In addition to absorbing losses, PSO has announced a discount of Rs4.82 per litre on petrol for its dealers.

The move is expected to ease pressure on fuel station owners and improve supply stability.

Why PSO Took This Step

Industry sources say the decision was taken to strengthen PSO’s position against oil marketing companies operating in Pakistan in partnership with foreign suppliers.

Previously, dealers reduced petrol and diesel orders when a price cut was expected. This often led to supply disruptions.

PSO believes the new system will restore dealer confidence and ensure smoother fuel availability.

First of Its Kind Decision

This is the first time in Pakistan’s oil sector that an oil marketing company has agreed to bear losses caused by fuel price reductions.

Analysts say the move could set a new trend and force other companies to rethink their pricing and dealer support strategies.

Impact on Oil Market

The announcement has created significant movement in the oil sector, with stakeholders closely watching how competitors respond.

Experts say the decision could improve supply management and reduce artificial shortages ahead of price changes.