• OCAC demands urgent meeting with PM, seeks his intervention
• Calls for release of Rs66bn in withheld PDCs; urges Ogra to settle all claims by June 8
• Labels Level-3 EV charger mandates impractical without wide adoption
ISLAMABAD: The country’s oil industry has protested the slow disbursement of their price differential claims (PDCs) against cheaper petroleum product supplies to consumers in early days of US-Iran war and proposed tax on windfall inventory gains in the coming budget.
In a letter to the prime minister, Oil Companies’ Advisory Council (OCAC) — a cartel representing around three dozen oil marketing companies and refineries — demanded an urgent meeting on oil industry’s pressing challenges.
OCAC Chairman Asif Iqbal said the meeting of leadership of top 10 oil industry players with the prime minister was crucial to discuss the critical issues that are adversely impacting the financial sustainability of the downstream petroleum sector.
“The oil industry is currently facing acute liquidity constraints and growing financial pressures owing to delayed recoveries, rising operating costs, increasing compliance requirements and policy uncertainties,” Mr Iqbal wrote to the prime minister, urging timely policy intervention for stability.
The OCAC chief said the outstanding PDCs worth about Rs54 billion had been released to the industry, while outstanding claims of around Rs66bn still remained pending.
“The prolonged delay in settlement of these claims has severely impacted cash flows and resulted in a significant liquidity crisis for OMCs,” he said adding that despite extensive verification through internal and external audits, only a portion of the verified claims had been disbursed so far.
The OCAC demanded that Oil & Gas Regulatory Authority (Ogra) be directed to facilitate the release of all outstanding claims by June 8 in order to provide much-needed relief to the industry. Next, the oil industry agitated against the proposed taxation in the coming budget on inventory gains retained by it as prices maintained a rising trend.
It said a high-powered committee had reportedly been constituted to review the cross-subsidy mechanism and examine the possible recovery of inventory gains arising from fluctuations in international oil prices.
While supporting the review in theory, the industry demanded that the review be conducted with fairness and consistency. Under the prevailing policy directive, OMCs are required to maintain a mandatory stock cover of 20 days; therefore, any mechanism addressing inventory gains must also equitably recognise inventory losses under the same principle, in the event of adverse price movements.
The OCAC raised the issue of marketing margins unchanged for almost three years. It said the revisions are pending since September 2023 despite rising costs and inflation. This erosion of margins has worsened financial challenges and limited investment in essential infrastructure.
The OCAC requested the PM’s help to create a fair and predictable annual margin adjustment mechanism for sector sustainability.
The federal cabinet had tied increased marketing margins for OMCs and dealers to digitising product stocks for online visibility to prevent hoarding and misreporting, but this process is still incomplete.
After that, the OCAC noted that mandatory installation of Level-3 fast EV chargers at petrol stations involves high costs and isn’t viable without widespread EV use, affordable manufacturing and supporting infrastructure.
Moreover, the industry stated that requiring K-Forms (clearance for explosive safety) for new retail outlets to include EV charger installation was hindering retail network growth. This condition caused delays in opening completed outlets, discouraged investments in new sites, diverted funds from crucial infrastructure and posed a risk of stranded assets.
It demanded a corresponding marketing margin support and a commercially viable framework to facilitate the effective implementation of such initiatives.
Published in Dawn, June 1st, 2026