Petroleum dealers call off planned strike as govt approves margin revision

The Pakistan Petroleum Dealers' Association (PPDA) has abandoned its plans to initiate a strike on Saturday, following the government's endorsement of a proposed revision in dealers' margins. The finance ministry confirmed the approval of the margin revision in a statement, although the specific amount remained undisclosed. During a meeting chaired by Finance Minister Muhammad Aurangzeb, the Economic Coordination Committee deliberated on the matter of revising the margins for motor spirit and high-speed diesel, as reported by the PPDA.

The government raised the petroleum dealers' margin by Rs1.34 per litre, raising the total margin to Rs10 per litre. This increase satisfied the association's demand for an eight percent rise in the margin. Currently, the dealers' margins stand at Rs8.64 per litre. Malik Khuda Bakhsh, the PPDA Chairman, informed the petroleum minister that the prime minister had approved the Rs1.34 increase in the dealers' margin. However, the Prime Minister's Office has yet to publicly confirm the change.

According to Bakhsh, a reduction in the intensity of the Middle East conflict situation may lead to more frequent revisions of petroleum product prices, potentially every 7 or 15 days instead of daily. The government had previously rejected the dealers' demand for monthly price fixing, opting to continue the daily price-fixing mechanism for petroleum products.

Last month, the government announced its decision to revise fuel prices daily, deviating from the weekly system that had been prevalent for months. In its Friday statement, the PPDA announced the postponement of the strike scheduled for Saturday, citing the government's assurances. However, PPDA Vice Chairman Tariq Hassan warned that the association would persist in its protest until all its demands were met.

He further revealed that approximately US$50 million belonging to petroleum dealers remained outstanding with the government due to the lack of margin increases over the past three years.

The PPDA had issued a 72-hour ultimatum to the government on Wednesday, expressing dissatisfaction with the failure to fulfill the promises made by the petroleum minister. The association specifically demanded an increase in margin to eight percent on the retail sale price of petrol. If the government failed to meet the demands within the given timeframe, petrol pumps across the country were threatened to shut down indefinitely from 6am on Saturday, August 15, and not reopen until the demands were addressed.

A delegation of petroleum dealers had met with Petroleum Minister Ali Pervaiz Malik in Islamabad on Wednesday, during which the minister assured the delegation that the pending Rs1.34 per litre increase in dealers' margin had already been forwarded to the Economic Coordination Committee and awaited approval from the Federal Cabinet.