ISLAMABAD: Pakistan’s oil and gas exploration companies are set to receive higher wellhead gas prices for the second half of 2026 after the Oil and Gas Regulatory Authority (OGRA) revised rates in response to stronger crude oil prices earlier this year.
The revision, effective against first-half 2026 prices, represents an average increase of about 8% to 10% and is expected to support earnings for exploration and production companies.
OGRA’s revision covers gas prices for July through December 2026 and follows the regulator’s routine semi-annual pricing mechanism. Under the process, the average oil price from the preceding six months is used to determine wellhead gas prices for the following six months.
Arab Light crude averaged $92.20 per barrel from January through June 2026, compared with $68.40 per barrel from July through December 2025, an increase of about 35% over the six-month period. The January-June average is being used to determine wellhead gas prices for the second half of 2026.
For companies operating under the Petroleum Policy 2012, or PP2012, the 35% increase in crude prices is estimated to translate into a roughly 10% to 11% increase in gas prices. The adjustment reflects the sliding benefit mechanism under the PP2012 policy.
OGRA has issued revised price notifications for several fields, while notifications for the remaining fields are expected to follow. The revised rates may vary slightly among fields because the wellhead prices for some fields are based on different oil-price reference periods.
For a few fields, the calculation uses oil prices from December 2025 through May 2026 and June through November 2025. This may result in a slight variation in their revised wellhead gas prices.
The average 8% to 10% increase was already incorporated into forecasts for the exploration and production sector, according to the assessment accompanying the price revision. Despite being largely anticipated, the higher gas prices are viewed as positive for E&P earnings.
The latest notification therefore provides a favorable pricing adjustment for producers, particularly companies with exposure to fields covered by the PP2012 framework. Further notifications for the remaining fields will provide greater clarity on the impact of the revisions across individual producers.
