This has followed by the release of the first instalment of Rs 1 billion by the Finance Ministry to oil-marketing companies as compensation, it was learnt here on Saturday.
Oil prices are all-time high in the international market but the government is absorbing the increase to protect consumers from financial burden.
Due to this policy, oil-marketing companies are not getting adjustment on transportation to long distance cities.
The government has applied a policy of uniform oil prices in 29 major cities and it pays differential as compensation to them.
Oil-marketing companies claimed losses amounting to Rs 4 billion as on October 15 due to the government policy of capping oil prices for the last almost three months.
Sources said representatives of oil-marketing companies had conveyed to the government early this month that their accumulated loss due to the government policy was making difficult for them to carry on with their business in Pakistan.
Sources said the government was fully aware of the difficulty of oil-marketing companies and it would release the remaining amount of compensation of Rs 3 billion in three equal instalments by the end of current calendar year.
He said the strategy of making payment to oil-marketing companies would help the government keep budget deficit at some reasonable level.
Oil prices in the international market are ranging between $50 and $55 and its impact could be more than Rs 5 per litre on domestic rates.
But the government took a conscious decision and capped oil prices at mid-July position.
The government has cut down its petroleum development levy (PDL) share to zero to help it absorb the difference in international and domestic rates.
This policy has added Rs 20 billion in budget deficit by October 15 and the gap is increasing with every passing day.
The government circles are apprehending a loss of Rs 70 billion to the national exchequer for increase in oil prices by the end of current fiscal year.