The government’s move to cut trader premiums on petrol and oil, among other commodities, has prompted the nation’s oil marketing companies (OMCs) to threaten to stop selling fuel as of Thursday.
The OMCs released the following statement to The Standard yesterday: “We would like to notify everyone that the Ministry of Finance has unilaterally decided to lower the trader premium on petrol 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. We are suppliers of petroleum products, employers, taxpayers, and business entities. In order to spread the impact of the adjustments they aimed to cover at the expense of the OMCs, the ministry has also experimented with the densities of fuel and petrol.
Furthermore, the OMCs stated that “rising fuel costs, operational expenses, structurally regulatory standards, municipality trading licence fees, and domestic tax were not given due consideration in the reduction of dealer and transport margins.”
The OMCs also claimed that by raising the National Road Authority’s charge from D3 to D4.50, which they view as “a mutilation,” the Ministry of Finance is utilising them to finance the ongoing road improvements.
It’s also critical to inform the public that, in spite of all of these modifications, the Ministry of Finance is still receiving D19.26 for gasoline and D17.23 for gas per litre, although these amounts could have been far more affordable for the general population. The OMCs encouraged the pricing committee to lower the price of fuel so that the general population could afford it since the Platts prices of the world market began to decline, but this suggestion was ignored. But since the pricing committee is disabled, the OMCs would like to let the public know that as of Thursday, April 4, 2024, we will no longer be dispensing fuel under terms and conditions that are harmful to our businesses. We apologies for any inconvenience this may have caused and we are asking a conversation with the finance minister,” the OMCs said.
The Standard is aware that this morning the administration and the OMCs will discuss the issue.