KARACHI: The federal government has agreed to increase the margin of petroleum dealers by Rs 1.64 per litre after a marathon meeting on Monday, in a bid to forestall a strike threatened by dealers.

This was the second round of talks between Minister of State for Petroleum Musadik Malik and Pakistan Petroleum Dealers Association (PPDA) representatives, along with other stakeholders of the oil industry and government departments.

According to sources, petroleum dealers expressed reservations over the proposed increase but gave in at the end of a marathon meeting which lasted several hours.

It was agreed that the dealers’ margin would be increased by 41 paise per litre in each of the next four fortnights instead of a one-time raise. This would raise the oil prices by Rs 1.61 per litre, in addition to the revision, if any, made by the government.

After the meeting, the PPDA chairman, Abdul Sami Khan, said dealers were not satisfied but agreed to avoid strikes.

He added the agreement between the dealers and the government also carried signatures of the Ogra chairman and director general.

Currently, the dealers’ margin is Rs6 per litre on petrol and diesel which would increase to Rs 7.64 after two months.

Last week, PPDA —which represents pump owners — called for a nationwide shutdown of petrol stations from July 22 if their margin was not raised.

However, after successful negotiations with the petroleum minister on Friday, the strike was deferred till Monday.

The dealers had been demanding an increase of Rs5 per litre to Rs 11. However, there were reports that the minister in last week’s meeting did not cede to this demand.

Sources said it was agreed that the increase in margins would be decided based on actual data, acceptable to all concerned stakeholders.

The government had also decided to collect petroleum dealers’ sales figures to ascertain their actual profit margin. It was not immediately known what was discussed in the July 24 meeting.

Dealers had also criticised the government for ‘not addressing their concerns’ on the issue of smuggling of diesel and petrol from Iran which, they claimed, had cut their sales by 30pc.

Published in Dawn, July 25th, 2023