The federal government is weighing the revival of a targeted petrol relief programme, sources within the Petroleum Division confirmed Tuesday, as officials scramble to buffer the impact of rising fuel costs on lower-income households.
The move signals a potential return to the controversial “cross-subsidy” model first introduced during the previous administration. Under that framework, high-end consumers paid a premium at the pump to fund a direct discount for motorcycle and small car owners.
Finance Ministry officials are currently running the numbers. They’re assessing whether the national exchequer can withstand the fiscal strain without triggering fresh conditions from the International Monetary Fund (IMF). The last time such a programme was proposed, the Fund expressed sharp reservations, citing the risk of massive budget slippage and the potential for market manipulation.
“The government is looking for a mechanism that doesn’t blow a hole in the budget,” a senior official said on condition of anonymity. “The challenge isn’t just the funding—it’s the enforcement and preventing the leakage of subsidized fuel to higher-income groups.”
The economic stakes are high. Inflation remains a persistent pressure point, and fuel prices act as the primary driver for transport costs and food logistics. A targeted relief package could provide immediate political breathing room for the coalition government, which has faced mounting public anger over the cost of living.
However, energy economists warn that the administrative burden of identifying “deserving” beneficiaries remains a logistical nightmare. Previous attempts to implement similar systems relied on data from the Benazir Income Support Programme (BISP), but syncing that data with real-time fuel consumption patterns proved difficult.
Market analysts also point to the potential for fuel smuggling. When a significant price gap exists between subsidized and market-rate fuel, the temptation for illegal diversion increases, often leading to artificial shortages at retail stations.
“If they go ahead with this, the design has to be foolproof,” said one energy sector consultant. “If it’s just a repeat of the last attempt, it will likely collapse under its own weight within months.”
For now, the proposal remains in the discussion phase. Whether the government prioritizes immediate electoral relief or adheres to the fiscal discipline required by its current IMF bailout programme will become clear in the coming weeks.
