Pakistan’s oil retailers have urged the government to urgently intervene and prevent a potential disruption in the country’s fuel supply chain due to pending subsidy payments, warning that mounting financial pressures on oil marketing companies (OMCs) could lead to shutdowns. Pakistan on Thursday hiked petrol and diesel prices to Rs458.40 ($1.65) and Rs520.35 ($1.87) per liter, respectively, reflecting continued volatility in international energy markets. The new prices marked an increase of Rs137.23 ($0.49) for petrol and Rs184.49 ($0.66) for diesel.
To reduce the impact of international market volatility on domestic consumers, Islamabad has relied on a price differential claim (PDC) system, under which oil marketing companies (OMCs) sell fuel at regulated prices below international rates and later seek reimbursement for the difference.
“The survival of the emerging companies is at stake because the PDC amount the government is giving to the masses is being paid through us,” Tariq Ali Wazir, chairman of the Oil Marketing Association of Pakistan (OMAP), told Arab News.