The Economic Coordination Committee (ECC) of the
Currently, refineries are allowed to fix ex-refinery sales prices of petroleum products on a monthly basis that is subject to the condition that the ex-refinery price cannot be more than the
According to the report, the current system based on PSO's last month procurement disincentives OMC's in times where there is volatility in the market. As a result, OMC's opt to let their inventories run dry instead of importing it on unfavorable margins.
Therefore, OMCs were reluctant to import when the margin was unfavorable and instead let the inventory run dry leading to a supply crisis at the national level.
The new pricing mechanism proposed by the Petroleum Division to ECC on
Moreover, it would have reduced the price risk from 30 days to 15 days incentivising OMC's to import petroleum products at current PSO rates to avoid inventory losses.
Earlier, the Petroleum Division, in its letter sent recently to the OGRA chairperson, warned against the hoarding of petroleum products, saying that OMCs may curtail supplies to their retail outlets 'in order to acquire financial gain of expected price increase of petroleum products effective from 1st July 2020'.
It further asked OGRA to deploy vigilance teams across the country to verify OMCs' stocks at depots/terminals/retail outlets so that uninterrupted suppliers to retail outlets could be ensured.
Earlier, in a letter dated 28th May, OGRA had requested
According to sources, OGRA had also directed OMCs to provide depot-wise sales and stock data of the past three months (March, April,
In order to provide relief to the consumers amid Covid-19, the government on Sunday had reduced the price of petrol by
Petrol price was slashed from
However, prices of high-speed diesel had witnessed a nominal increase of
As per the finance ministry, the government had decided to extend further relief in petroleum prices to the public 'despite the global trend of increasing POL prices'.
© Pakistan Press International, source