Petroleum Dealers’ Concerns & Strike Threat

• The All-Pakistan Petroleum Dealers Association (APPDA) has set a March 4 deadline for the government to address their concerns.
• APPDA claims dealers were excluded from discussions and demands clarity on profit margins if deregulation is implemented.
• APPDA representatives argue:
  • 15,000 dealers have been ignored in policy discussions.
  • Deregulation could allow oil companies to cut their margins.
  • Lubricant and high-octane fuel prices remain high despite currency fluctuations and global oil price changes.

Government & Regulatory Response

• The National Assembly’s Standing Committee on Petroleum, led by MNA Syed Mustafa Mehmood, directed the Petroleum Ministry to engage with dealers before making a final decision.
• Officials confirmed ongoing debates on whether fuel prices should be revised daily or weekly, but no decision has been finalized.
• OGRA Chairman downplayed the strike threat, calling it a misunderstanding and stating that dealers fear reduced profit margins under deregulation.
• The committee has summoned OGRA officials and APPDA representatives for further discussions.

Gas Sector Developments

• Lawmakers raised concerns over a deal between Sui Southern Gas Company (SSGC) and Jamshoro Joint Venture Limited (JJVL), warning that it could reduce local gas supplies.
• The SSGC managing director acknowledged potential risks, prompting the committee to demand a full briefing in the next session.

Strategic Underground Gas Storage (SUGS) Project Scrapped

• The committee rejected the proposed $1-1.5 billion SUGS project, citing financial infeasibility.
• The Inter State Gas Systems (ISGS) had requested Rs1.713 billion for a feasibility study, but both the Petroleum Ministry and the committee opposed it.
• The Additional Secretary of Petroleum Ministry stated that the project would store only nine LNG cargoes while adding unnecessary costs to imported gas.

Next Steps

• The government will engage with petroleum dealers before any deregulation decision.
• Further discussions between OGRA, APPDA, and lawmakers are scheduled.
• A detailed review of the SSGC-JJVL agreement will take place in the next committee session.

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The price of high-speed diesel (HSD) has also been increased by Rs2.61, taking it from Rs258.34 to Rs260.95 per litre.

The notification stated that the Oil & Gas Regulatory Authority (OGRA) adjusted prices in response to international market fluctuations over the last two weeks.

This marks the second hike in January 2025, following an increase of Re0.56 per litre on New Year’s Eve.

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