Fuel stations in Karachi closed sans strike, shortage

OMCs create man-made crisis after not receiving greater profit among fuel price hikes

KARACHI:

Several fuel stations in Karachi remained closed on Tuesday morning despite no call of a strike or shortage of petroleum products in the country.

Oil marketing companies and petroleum dealers have allegedly created a man-made fuel crisis as the incumbent coalition government increased petrol prices by Rs6.72 per litre with effect from yesterday (Monday) midnight.

Finance Minister Miftah Ismail on August 5 said that the country had enough petrol reserves to meet 20 to 25-day demand and a diesel stock to last 30 days.

However, many petrol pumps remained closed since Monday evening as the government increased petrol price against the proposal of a drop.

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Earlier, oil marketing companies (OMCs) demanded that the government increase their profit margins to Rs8.85 per litre of petrol and diesel from August 1, 2022. OMCs made the demand after the government increased petroleum dealers' margins to Rs7 per litre for both petrol and diesel from August 1, 2022.

Their previous margins stood at Rs4.90 per litre on petrol and Rs4.13 per litre on diesel.

The OMCs maintained that their profit margins and that of their dealers were revised collectively, however, this time they had not.

During the working day, commuters and parents of school-going children ran pillar-to-post in search of petrol, to no avail.

According to two pumps near and around Jinnah International Airport, new supplies of petrol would arrive at the station post noon by 2-3 pm.

"The [oil marketing] company has stopped supply from yesterday," a worker at a fuel station told the Express Tribune.

Oil price rise

The government on Monday increased the price of petrol by Rs6.72 per litre and reduced that of high-speed diesel (HSD) by Rs0.51 and kerosene oil by Rs1.67 per litre effective from August 16 (today).

The government increased the price of light diesel oil (LDO) by Rs0.43 per litre.

Earlier, the coalition government had reduced the price of petrol by Rs3.05 per litre and that of LDO by Rs0.12 per litre from August 1.

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However, it had increased the price of HSD by Rs8.95 per litre and kerosene oil by Rs4.62 per litre effective from August 1, 2022.

With the latest announcement, the price of petrol has been increased from Rs227.19 per litre to Rs233.91 per litre; LDO from Rs191.32 to Rs 191.75 per litre while decreased that of HSD to Rs244.44 from Rs244.95 per litre.

The price of kerosene oil has come down to Rs199.40 per litre from Rs201.07 per litre. In the past, the sharp devaluation of the rupee against the dollar had also been a major factor in determining oil prices.