Oil tanker contractors warn of strike after fuel price increase

Islamabad: The Oil Tanker Contractors Association (OTCA) has warned that it may suspend operations and begin protests following the latest increase in petroleum prices, saying the move could disrupt fuel supplies in several parts of the country.

In a statement issued by the association on Friday, OTCA President Abdullah Afridi said diesel prices had gone up by Rs184–185 and announced that tanker loading would be stopped. He said, "No oil tanker will be loaded tomorrow, and also called for an increase in freight charges. Afridi said tanker operators could not continue working under the existing rates and warned of financial losses if operations continued unchanged. He said, It is not possible to operate at current rates; there is a serious risk of financial losses, adding that the impact could be felt in Khyber-Pakhtunkhwa, Punjab and other areas. He further said, It is better to keep the vehicles parked than incur losses."

The federal government on Thursday raised the petrol price by Rs137 per litre, or 43%, taking it to a record Rs458.4 per litre after Prime Minister Shehbaz Sharif decided to impose additional taxes on consumers. The new petrol price was significantly above the increase seen in the international market because the petroleum levy on petrol was raised to a record Rs160.61 per litre.

The petroleum levy was increased from Rs106 to Rs161 per litre, amounting to an additional Rs55 in taxes. This was the second major fuel price increase in less than a month, after petrol and diesel prices had already been raised by Rs55 per litre, or 20%.

It further stated that the cumulative increase in petrol prices over one month had reached 63%, while the rise in high-speed diesel stood at 75%.

Afridi also criticised oil marketing companies and the authorities, describing the situation as

oppression and injustice

. He said the association had been trying to engage with officials for the past week without success. In his words,

We have been in contact with the authorities for a week, but no positive progress has been made.

He said Petroleum Minister Ali Pervaiz Malik had been contacted several times and that letters had been sent seeking talks. Afridi also said changes in pipeline quota were creating additional problems for tanker owners. He added, "Until freight rates are increased, tankers will not operate."

The OTCA chief warned that if the association’s demands were not accepted, the protest could expand into a countrywide strike. He also appealed to tanker owners to keep their vehicles off the roads and join the protest campaign.

The government increased fuel prices after it failed to persuade the International Monetary Fund to allow additional subsidies. The IMF had capped the maximum fuel subsidy at Rs152 billion.