KARACHI: The Oil Companies Advisory Council (OCAC) has called on the government to immediately notify a Rs1.22 per litre increase in oil marketing company margins, saying the sector faces a severe liquidity crisis after operating for nearly three full fiscal years without a revision.
The margin was last adjusted in September 2023 and has remained at Rs7.87 per litre through fiscal years 2023-24, 2024-25 and 2025-26, the council said in a letter to Energy Minister Ali Pervaiz Malik.
The Economic Coordination Committee has already approved the increase based on annual national consumer price index data for fiscal years 2023-24 and 2024-25, but the adjustment has not been formally notified, according to the council.
The council said oil marketing companies face mounting financial pressures, with approximately Rs66.7 billion in Price Differential Claims outstanding and unresolved GST and input-tax reimbursements. Companies have continued to supply fuel without interruption and maintained higher stock-cover requirements while operating on a regulated gross margin of only 2%, it said.
The industry group rejected the government’s proposal to link the approved increase to completion of a multi-year digitisation program, saying the industry has submitted a three-year implementation plan and remains committed to the government’s digitization agenda.
“Making completion of a multi-year, capital-intensive program a precondition for an already ECC-approved increase is unreasonable,” the council said.
The margin hike is expected to improve the sector’s financial sustainability and provide immediate liquidity relief, helping to reduce reliance on short-term borrowing, particularly for Pakistan State Oil.
The council also called for determination of overdue margins for fiscal years 2025-26 and 2026-27 with a mechanism for timely annual revision, and establishment of a sustainable long-term regulatory framework.
It has requested an urgent meeting with senior government officials to discuss the matter.
