In response to soaring oil prices, the Pakistan Petroleum Dealers Association (PPDA) declared on Sunday that it would go on a statewide strike beginning on July 18, closing down all gas stations across the nation.
According to a statement from PPDA Chairman Abdul Sami Khan, petroleum sales cannot continue at the current pace.
He declared that gas stations wouldn’t reopen until the margin on petroleum goods was raised after July 18.
The remark was made following an emergency meeting called by the PPDA where it was agreed that the stations would need to maintain a minimum commission margin of 6% in order to continue operations.
The existing margin of 3.5 percent was criticized by the officials as being unsustainable.
Yesterday, it was also revealed that, as a result of the removal of subsidies and the implementation of taxes, demand for gasoline and diesel fell by 12 and 16 percent, respectively, in June 2022 compared to the prior month, reversing a long upward trend in petroleum product sales.
Following a statewide walkout, the association’s demands were finally met by the former Pakistan Tehreek-e-Insaf (PTI) administration in November of last year.
However, it was agreed to raise the margin on petrol by 99 paisas per liter and the margin on high-speed diesel by 83 paisas per liter rather than complying with the PPDA’s demand for a 6% margin, or around Rs. 5 per liter, on gasoline (HSD). The margin on HSD was also raised to Rs. 4.13 per liter from the previous rate of Rs. 3.30.
It should be remembered that a significant oil industry association issued a warning in June of this year about an anticipated breakdown in the energy supply chain as businesses struggle financially as a result of international banks’ refusal to recognize Letters of Credit (LCs) opened by Pakistani banks.
Waqar Irshad Siddiqui, chairman of the Oil Companies Advisory Council (OCAC), revealed in an SOS call that the oil industry was experiencing financial difficulties, raising the possibility of a collapse in the nation’s energy supply system.
Prior to now, in order to offset the effects of the rise in global oil prices and the devaluation of the rupee against the dollar, the government had not imposed any general sales tax or petroleum levy on petroleum items.
To read our blog on “Following price increases, fewer people are buying petrol and diesel,” click here.
