KARACHI: Petrol pump owners across Pakistan have warned of a nationwide shutdown if the government does not immediately increase their sales commission following the recent sharp rise in fuel prices.
The All Pakistan Petrol Pump Owners Association and the Pakistan Petroleum Dealers Association said on Tuesday that the current profit margin was no longer enough to cover business expenses.
During a press conference in Islamabad, the associations demanded that their commission be raised to eight percent of the fuel invoice price. They argued that the existing fixed margin of Rs8 per litre was too low because of rising operational costs, electricity bills, staff salaries and transport expenses.
PPDA Chairman Abdul Sami Khan said petrol stations were operating under extremely difficult conditions. He stated that business costs had reached record levels while profit margins had remained unchanged for a long period.
He added that if the government failed to revise the commission, fuel stations across the country could stop accepting bank cards and corporate fuel cards because the current margin does not cover banking charges. Dealers said they currently pay 0.75 percent to banks and card companies for every Rs100 worth of fuel sold.
APPPOA Chairman Humayun Khan also raised concerns over the increasing sale of smuggled Iranian fuel. He said illegal petrol was entering the country and hurting licensed fuel retailers.
According to the association, the provincial government in Balochistan has set petrol prices at Rs280 per litre, allegedly because of the availability of smuggled Iranian fuel in local markets.
APPPOA Vice Chairman Nouman Ali Butt said dealers are currently earning less than two percent profit, which is not sustainable. He demanded a guaranteed minimum margin of Rs6 per litre with future adjustments based on changes in fuel prices.
The associations said they would hold another meeting in Karachi next week to decide their next course of action. Meanwhile, the latest increase in petrol and diesel prices, introduced by the government under Prime Minister Shehbaz Sharif, continues to create pressure on consumers and fuel retailers alike.
