ISLAMABAD (Eshfak Mughal):- Thi Oil Companies Advisory Council (OCAC) has demanded the government to increase fuel prices to meet the demand during the agricultural season starting from the second week of march 2023.
OCAC has written a letter to the Minister of State, Ministry of Energy and Petroleum division with regard to restrictive pricing of motor fuels.
They stated that prices of Motor Fuels have been restricted, yet again, for the second fortnight of February 2023 by the Government by not following the GoP approved pricing formula.
OCAC stated that the exchange loss adjustment was Rs 22.72 & Rs. 74.91 Per liter on MS & HSD respectively.
Similarly, FBR also reduced Customs duty by Rs 4.24 & Rs 3.64 per liter on MS & HSD respectively and the revised margin of Rs. 6 per liter has not been fully incorporated in USD price till date (Rs 1 per liter outstanding).
They mentioned that the companies will face Rs35 billion impact on the account of Customs Duty, impact of margin on MS as well as HSD.
OCAC in its letter claimed that this continued control of oil prices since the past year is not sustainable and will severely impact the already crippled Oil Industry.
The Industry is facing severe financial crunch due to high global prices, depreciation of Rupee, increased LC Confirmation charges, challenges in LC establishment and retirement, high markup rates, high premiums on import etc. and will not be able to survive if these unfair adjustments are not removed immediately.
In order to ensure survival of the Industry and any supply chain challenges, we request immediate revision of prices based on the GOP approved pricing formula to develop a mechanism for recovery of Exchange losses.
It is pertinent to mention that the agriculture season is expected to start in the second week of March 2023 and the industry will not be able to meet the increased demand placed on industry if the current restrictive pricing is continued further.