LAHORE: Chairman Oil Marketing Association of Pakistan (OMAP) Tariq Wazir Ali on Sunday appealed to the Ministry of Petroleum and Oil and Gas Regulatory Authority (OGRA) to reconsider the proposed option of shifting from fortnightly to weekly fuel price adjustments.
In a statement issued here, Tariq Wazir Ali said that OMAP believes that such a move will have severe and detrimental consequences for the already beleaguered Oil Marketing Companies (OMCs) in Pakistan.
He also said that current economic landscape, marked by lifeline margins, substantial FX losses, a PSO-benchmarked pricing formula, negative IFEM, delayed settlements of ICFS, and intricate sales tax adjustments, has placed an overwhelming and unsustainable financial burden on OMCs.
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The proposed weekly adjustments will only exacerbate the challenges faced by OMCs, introducing heightened uncertainty and mental strain for both the companies and their end-users.
He further said frequent and unpredictable fluctuations in fuel prices will create a ripple effect across various sectors linked to transportation and logistics.
While showing his concern, Tariq said that this move will not only threatens to disrupt the delicate balance of the fuel industry but also poses a risk of panic in the economic landscape. In the current economic turmoil, introducing such a measure could have far-reaching and adverse effects on the buying decisions of both OMCs and consumers.
Moreover, the weekly adjustment mechanism raises concerns about potential fuel shortages, particularly in suburban and rural areas, as OMCs grapple with the challenges of adapting to a more volatile pricing structure. We urge Ogra to reconsider this proposal, taking into account the precarious state of the industry and the potential negative repercussions for the broader economy.
Tariq was of the view that in these challenging times, we request the Ogra and Ministry of Petroleum to refrain from implementing changes that may further jeopardize the survival of OMCs. Instead, we propose engaging in a comprehensive dialogue with industry stakeholders to devise more sustainable and well-thought-out solutions that align with the interests of all stakeholders.
Copyright Business Recorder, 2023
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