After hours of negotiations, the government agreed to increase the profit margin on petroleum products by Rs1.64 per litre in order to persuade petroleum dealers to call off the strike they threatened last week.
Abdul Sami Khan, Chairman of the Pakistan Petroleum Dealers Association (PPDA), announced the agreement.
The government proposed an increase in dealer margins of Rs1.64 per litre.
The dealers, who had initially requested an increase of Rs5 per litre, initially objected to this increase as “insufficient” in light of the increased cost of doing business.
They did, however, accept the offer later.
The increase in dealer margins will be passed on to consumers in four stages.
It will be raised by Rs.0.41 per litre every fortnight, and the dealers will receive a full raise of Rs1.6 per litre in two months, bringing the dealers’ margin to Rs7.6 per litre after 2 months from the current Rs6 per litre.
The PPDA, the petrol pump owners’ representative, announced last week that fuel pumps across the country would be shut down beginning July 22 in order to demand higher profit margins amid an inflation crisis.
The association stated in a statement that they informed the State Minister for Petroleum, Musadik Malik, of their concerns, but to no avail.
According to the official communique, interest rates and inflation have hurt operators’ businesses, and the dealership margin should be increased.
It claimed that sales had dropped by 30% as a result of Iranian fuel being smuggled into the country.
The PPDA deferred its strike for two days the next day after members of the association negotiated with the petroleum minister, who arrived in Karachi on Friday to persuade the PPDA to call off the nationwide strike.
