ISLAMABAD-The Economic Coordination Committee (ECC) of the Cabinet on Wednesday approved to revise upwards the margins of oil marketing companies (OMCs) and dealers on petroleum products, which would increase the oil prices in the country. Petroleum Division updated the ECC about the recommendations firmed up by a sub-committee established in line with the earlier decision of the ECC dated Jan 28, 2021 regarding review of oil marketing companies (OMCs) and dealers margins on petroleum products. After detailed discussion, the ECC approved to revise OMCs and dealers margins on the basis of 85% of the latest average core inflation with immediate effect, and directed to expedite a study by PIDE.
An official said that Petroleum Division had informed the ECC that the sub-committee had proposed a hike in margins of OMCs and dealers of petroleum products on an interim basis as the study had not been conducted so far. The committee had recommended that the government should give interim relief to the OMCs and dealers till the PIDE study is completed. The study is likely to conclude by June 2021. The committee had recommended an increase in margins of petrol and diesel by Rs0.19 per litre from the existing Rs2.81 to Rs3 per litre each for OMCs. It also proposed a hike of Re0.25 per litre on petrol and Re0.21 per litre on diesel for dealers to Rs3.95 and Rs3.33 per litre, respectively. The current margin on petrol stands at Rs3.70 and high speed diesel Rs3.12 per litre. These margins have been proposed on interim basis till the completion of the study by PIDE. Federal Minister for Finance and Revenue, Dr Abdul Hafeez Shaikh chaired the meeting of the ECC. The Power Division submitted another summary about re-targeting of power sector subsidies (phase-I). The Committee considered and approved the proposals recommending that Power Division will complete the analysis based on the listed principles and submit specific recommendations on thresholds and rates for the consumers before the ECC by 31st March, 2021. Ministry of Industries and Production presented another summary seeking permission regarding operation of two plants namely Agritech and Fatima Fertilizer from March till November, 2021 to produce urea from SNGPL based plants. The underlying rationale is to bridge the gap between estimated demand and actual domestic production of urea in the country. The Committee approved operations of the above-mentioned plants with a direction that the Ministry may closely monitor the demand-supply situation and take decision to import urea, if needed, as per requirement during the current year.
