Petroleum crisis deepens as govt, dealers still at loggerheads

Hamza Habib Our Correspondent

25th Nov, 2021. 09:05 pm
Petrol Strike

Image: Athar Khan/Bol News

ISLAMABAD: The government and the All Pakistan Petroleum Dealers Association (PPDA) are still at loggerheads on the issue of increase in the profit margins.

In a statement, Federal Minister for Energy Hammad Azhar said that some groups of the petroleum dealers want to pressurise the government for an increase in their margins to Rs9, which is unacceptable.

He said the Petroleum Division has already sent a summary to the Economic Coordination Committee (ECC) of the Cabinet recommending an increase in the dealers’ margin; therefore, any strike call from the petroleum dealers is uncalled for.

From time-to-time, the government has increased the profit margins of dealers and the Oil Marketing Companies, he said, adding that in March this year, the government has felicitated the dealers by increasing their profit margins.

In a summary to the ECC, the Petroleum Division seeks an increase of 71 paisa/ litre in the motor spirit and high-speed diesel (HSD) for the Oil Marketing Companies (OMC), while for the petroleum dealers, it has proposed an increase of 99 paisas in the motor spirit (MS) and 83 paisas increase in high-speed diesel (HSD).

If the ECC approved the summary, the OMCs margin on MS and HSD will increase from the existing Rs2.97 to Rs3.68, while for the petroleum dealers the margin on MS will increase from the existing Rs3.91 to Rs4.90/litre and on HSD from the existing Rs3.30 to Rs4.13.

However the dealers want the Petroleum Division to fix their margin to 6 per cent on the existing oil prices, which makes it almost Rs9/litre, he added.

Meanwhile, the minister met the representatives of leading OMCs, PSO, Shell, Total and Parco along with some representatives of the All Pakistan Dealers Association and urged them to call-off their strike.

The PSO spokesman claimed that all the PSO petrol pumps remained operational; however, on the ground, the reality was contrary, as the majority of PSO pumps remained closed.

An official of the PSO on the condition of anonymity said that of the 3,500 PSO petrol filling stations, the company owned only 28, the rest belonged to private owners.

“We can’t force the privately-owned petrol pumps to remain operational. Their association is demanding increase in the profit margins for quite some time but the government is not willing to meet their demand due to the criticism from the public and Opposition over spike in the petroleum products prices. There is very little we can do,” he added.

Similarly, in the twin cities of Rawalpindi and Islamabad only 20 per cent of the petrol pumps were operational. Some of the PSO and Shell petrol filling stations were seen providing petrol with long queues.

Officials in the Petroleum Division claimed that the issues with the petroleum dealers will be settled soon; however, the petroleum dealers association refuted these claims and said the Petroleum Division didn’t come up with any concrete and realistic proposal to them.

They vowed to continue the strike until their demands were met.

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