The country’s oil marketing companies (OMCs) have threatened to stop selling fuel from Thursday over the government’s decision to cut trader premiums on gas and oil, among others.

In a statement shared with The Standard yesterday, the OMCs stated: “As suppliers of petroleum products, employers, taxpayers, and business entities, we want to inform all and sundry that the Ministry of Finance has unilaterally taken a decision to cut the trader premium on gas oil from US$67.79 in March to US$67.50 downwards in April, when the dollar is currently trading at US$68.50 upwards. The ministry has also played with the densities of both gas and petrol to spread the effect of the changes they sought to cover at the cost of the OMCs.”

The dealer and transport margins, the OMCs added, “were also reduced without any due consideration to rising fuel costs, operational expenses, structurally regulatory standards, and municipality trading licence fees and domestic tax.”

The OMCs also alleged that the Ministry of Finance is using them to finance the current road projects by increasing the National Road Authority’s levy from D3 to D4.50, which they regard as “a mutilation”.

“It is also important to let the public know that despite all these mutilations, the Ministry of Finance is getting D19.26 per litre on petrol and D17.23 per litre on gas, which could have been much more reasonable and cheaper for the consumer. Since the Platts prices of the international market started going down, the pricing committee was advised by the OMCs to make the price of fuel affordable to the general public, but this fell on deaf ears. However, the OMCs would like to inform the general public that effective Thursday, 4 April 2024, we will stop dispensing fuel on terms and conditions detrimental to our businesses since the pricing committee is disabled. While requesting dialogue with the finance minister, we apologise for any inconvenience this may cause,”” the OMCs stated.

The Standard understands that the government will meet the OMCs this morning over the matter.

Source: The Standard

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