Shehbaz Sharif Approves Amendments to Pakistan Oil Refining Policy

Prime Minister Shehbaz Sharif approved amendments to the Pakistan Oil Refining Policy 2023 during a Cabinet Committee on Energy meeting in Islamabad on July 28, 2026. The policy aims to attract $6 billion in investments to modernize refineries and shift production toward cleaner Euro-4 and Euro-5 compliant fuels, which Sharif stated is essential for energy security and reducing import reliance.

The approval follows a period of tension between the government and industry stakeholders. Refinery operators had argued that reducing deemed duty protection from 7.5 percent to 5 percent, combined with increased tax costs from the Finance Act 2024, would undermine project viability and penalize them for government delays. While the Oil and Gas Regulatory Authority initially expressed reservations about signing commercial agreements, Sharif directed the agency to implement reforms to improve transparency, competition, and investment.

To secure the necessary funding, Sharif called for investment roadshows in Qatar, Saudi Arabia, and other Gulf nations. He also ordered the expansion of Pakistan's strategic petroleum reserves and warned that any negligence or delays in executing the amended policy would not be tolerated.