OMCs warn government of diesel shortage (Pakistan)

The Oil and Marketing Companies (OMCs) have warned the government that country would be facing acute diesel shortage because of their inability of future investments and the looming danger of closing down operations after their profit margin is frozen, sources in petroleum ministry told Daily Times Saturday.

The ministry has prepared a summary to freeze the profit margin of OMCs that is applied from July 1 along with the reduction of deemed duty from 10 percent to 5 percent for Oil refineries.

Sources said that the current oil pricing formula was made in 2001 in which the margin of the companies was shifted from fix margin regime to percentage basis at 3.5 percent. They informed that existing pricing formula has attracted investment of Rs 25 billion since 2001 to 2007.

DailyTimes