Long queues as petrol retailers go on strike to protest shrinking profit margins

LAHORE/KARACHI/ISLAMABAD: The petrol retailers went on a nationwide strike Thursday as the main industry body flagged low-profit margins, exacerbated by the government’s move to raise taxes and boost revenue under its agreements with the International Monetary Fund (IMF).

“This strike is nationwide. This is all over Pakistan and it will be for an indefinite period. We will not make our pumps operational till our demands are met,” Khwaja Asif Ahmed, secretary of information at Pakistan Petroleum Dealers Association (PPDA), told reporters in Lahore on Wednesday evening.

In an earlier handout, the body said a meeting of petroleum dealers was held in Lahore on November 20, wherein it was pointed out the government would raise the profit margin three years back.

The PPDA added the promise is still not fulfilled and it has become difficult for dealers to run fuel stations due to growing inflation and an increase in the prices of petroleum products.

Meanwhile, the Oil and Gas Regulatory Authority (OGRA) has said it would try to curb the impact of the strike, adding that and any disruptions would be met with legal action.

“All oil marketing companies have been advised to ensure uninterrupted oil supplies at retail outlets and OGRA enforcement teams are in-field to ensure the same,” the OGRA statement said.

“Anyone involved in oil disruptions causing public inconvenience shall be dealt strictly in accordance with OGRA laws.”

The petroleum ministry has assured that vehicle fuel will be available in all major outlets — Pakistan State Oil (PSO), Shell and Total stations across the country.

A ministry spokesperson said that a summary to increase the profit margin of petroleum dealers has already been sent to the ECC. The ministry is working on increasing the margin and a federal cabinet would take a decision soon.

Large crowds of drivers, with their cars and motorbikes, gathered at petrol stations in main cities, including Lahore and Karachi overnight, ahead of the strike which began at 6:00 am on Thursday.

The government has said that under an agreement with the IMF struck this month to release around $1 billion of a $6 billion financing facility, it would increase levies to help meet its revenue targets.

The gas station association has said profit margins have already dropped over the last few months as the government previously increased the petroleum levy.

With fuel prices rising several times this year, Pakistan will be continuing to add around Rs5 to petrol prices every month as part of the petroleum levy under the IMF’s condition until it touches the agreed-on Rs30 hike.

The economy is currently grappling with high inflation, current account deficit, currency devaluation and dwindling of foreign reserves.

— With additional input from Reuters

The post Long queues as petrol retailers go on strike to protest shrinking profit margins appeared first on Pakistan Today.

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