Cabinet ratifies 6pc increase in profit margins of oil companies, dealers

ISLAMABAD: The federal cabinet has ratified a decision of the Economic Coordination Committee (ECC) of the Cabinet with regard to 6pc increase in the margins of Oil Marketing Companies (OMCs) and dealers on the sale of petrol and diesel across the country.

According to sources, dealers’ margin on petrol has been increased by Rs0.22 to Rs3.92 per liter, while the same on diesel has been Rs0.19 to Rs3.31 per liter. Similarly, OMCs would now charge Rs2.98 on sale of each litre of petrol and diesel instead of the existing rate of Rs2.81 per liter, showing an increase of 17 paisa.

The revision in the margins of OMCs and dealers was worked out based on the Consumer Price Index (CPI) – from June 2019 to October 2020 — duly published by the Pakistan Bureau of Statistics. However, the ECC increased margins by 6pc as an interim arrangement.

The ECC, in its decision, had also constituted a committee under the chairmanship of the then Special Assistant to Prime Minister on Petroleum Nadeem Babar to revisit the existing mechanism for determination of margins for OMCs and dealers on MS/HSD in a holistic manner, and to devise a revised mechanism for purpose ensuring interests of all stakeholders, particularly the consumers.

In addition, the Petrol Dealers Association, in a letter, had requested the Petroleum Division that instead of delaying or denying the increase, it should continue with the inflation-based method until the PIDE study is completed.

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Ahmad Ahmadani
Ahmad Ahmadani
The author is a an investigative journalist at Profit. He can be reached at [email protected].
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