Every litre of fuel you consume no matter where you are in Pakistan has the same selling price – the one determined by the Oil Gas and Regulatory Authority (OGRA). The cost of transporting fuel to different parts of the country is, however, not the same. It obviously costs more to transport fuel to the north of the country, given that it mostly lands or is refined in the southern ports.
To ensure the price remains equal, the regulator has a pricing mechanism called the Inland Freight Equalisation Margin (IFEM). Don’t worry, it isn’t as complicated as it sounds – and by the end of this, you’ll get the gist of it, and something else very interesting about it.