ECC approves revised profit margins for petroleum dealers

ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet on Friday approved a revision in dealers’ margins on Motor Spirit (MS) and High-Speed Diesel (HSD), after the Pakistan Petroleum Dealers Association (PPDA) postponed its planned nationwide strike following assurances from the government.

Finance Minister Muhammad Aurangzeb chaired the ECC meeting at the Finance Division, where the committee considered a Petroleum Division summary on revising dealers’ margins on petroleum products.

The development came after PPDA Chairman Malik Khuda Baksh announced the postponement of the association’s planned strike, saying the government had assured dealers of an increase in their profit margin.

Speaking at a press conference in Karachi, Baksh said Petroleum Minister Ali Pervaiz Malik had spoken to him by telephone and assured him that the dealers’ margin would be increased.

According to Baksh, the petroleum minister had indicated an increase of Rs1.34 in the dealers’ margin after obtaining special approval from Prime Minister Shehbaz Sharif.

Baksh said the ECC meeting had been convened following the petroleum minister’s intervention, while a special committee was also being formed to consider oil marketing companies’ demand for abolition of the quota system.

“The government has accepted two of our important points,” Baksh said, adding that the association would continue seeking maximum benefits for the petroleum industry.

He said the government had also appreciated petroleum dealers for “always standing with the state”.

On the mechanism for daily petroleum price adjustments, Baksh said the government’s proposed solution would be implemented in three stages and was expected to take around two weeks.

He said the government had accepted the dealers’ demand for a minimum period for determining petroleum prices, adding that the association had proposed fixing prices for one month.

“The government may agree to determining prices for seven days,” he said.

The ECC meeting was attended by Federal Minister for National Food Security and Research Rana Tanveer Hussain, Petroleum Minister Ali Pervaiz Malik, Economic Affairs Minister Ahad Khan Cheema, federal secretaries and senior officials from relevant ministries and divisions.

The ECC’s approval formally advances the government’s commitment to revise petroleum dealers’ margins, potentially averting a disruption in fuel supplies that could have resulted from the planned strike.

Meanwhile, Petrol Pump Owners’ Association leader Noman Ali Butt said that the dealers’ margin has been increased by Rs1.34.

Following the increase, the dealers’ margin has risen to Rs9.98 from Rs8.64 previously, he said adding that “We are grateful to the prime minister and petroleum minister for increasing the dealers’ margin.”