SBP to study daily fuel price impact on inflation

ISLAMABAD: The federal government has directed the State Bank of Pakistan (SBP) to conduct a comprehensive study on how the daily revision of petroleum prices affects inflation, as authorities seek new measures to protect consumers from rising living costs and volatile global energy markets.

The decision was taken during a meeting of the National Price Monitoring Committee (NPMC), which reviewed the country’s inflation outlook and discussed ways to minimise the impact of fluctuating fuel prices on households and businesses.

According to officials, the SBP has been asked to prepare a detailed action plan within 15 days to evaluate the inflationary effects of daily adjustments in petrol and high-speed diesel (HSD) prices, following international best practices. The central bank is expected to recommend policy options that could help maintain price stability while supporting economic growth.

The committee was informed that the SBP’s primary responsibility is to ensure price stability through effective monetary policy, including the use of interest rates to manage inflation expectations and regulate money supply.

Alongside the SBP study, the NPMC instructed provincial governments, Azad Jammu and Kashmir, Gilgit-Baltistan and the Islamabad Capital Territory to strengthen market monitoring and prevent unjustified increases in the prices of essential commodities whenever fuel prices are revised.

The committee also expressed concern over excessive pricing of liquefied petroleum gas (LPG), noting that consumers in many areas were paying significantly more than the official rates notified by the Oil and Gas Regulatory Authority (OGRA). Authorities have been directed to intensify monitoring and narrow the gap between notified and market prices.

Officials said the recent regional conflict involving Iran had disrupted energy markets, contributing to higher LPG prices despite regulatory efforts.

The meeting also focused on the prices of key food items, including tomatoes, chicken, wheat flour and edible oil. Representatives from the Ministry of National Food Security attributed the surge in tomato prices to seasonal shortages, explaining that Pakistan was importing tomatoes from Iran and Afghanistan to meet domestic demand.

However, following the closure of the Afghanistan border, officials said additional tomato imports would now be sourced from Romania to prevent supply shortages and stabilise prices.

To improve food quality and consumer protection, the Ministry of Science and Technology will work with the Pakistan Bureau of Statistics (PBS) and provincial authorities to develop testing standards for loose milk, dairy products, edible oil and ghee. Accredited laboratories will conduct regular testing, with quarterly reports submitted to the NPMC.

The committee also urged authorities to reduce wholesale and retail price disparities across different cities, improve the supply chain for essential goods and work more closely with the private sector to arrange timely imports before seasonal shortages trigger sharp price increases.

Officials expressed hope that stronger coordination, tighter market oversight and evidence-based policymaking would help ease inflationary pressures and provide greater stability for consumers in the coming months.