Karachi: The government has decided to deregulate petroleum prices through abolition of Inland Freight Equalization Margin (IFEM) to refineries and marketing companies.
According to Alfalah Securities Limited, This step would encourage the local refineries to increase their production thus resulting in a lower dependency on imported POL products. OGRA would ensure elimination of any sort of price manipulation and also make sure that all OMC’s get supplies from oil refineries according to their market share. The GoP believes that abolition of IFEM would create competition among OMC’s and refineries to use the cheapest mode of transportation which will bring POL prices to further reduce and ensure curbing of malpractices related to tax refunds, sale of counterfeit products and dumping. It is expected that the differences in petroleum prices would enable the government to earn additional revenue of PkR 4 bn per annum.