rewrite this title with different wordingCollapse Looms: Oil Marketing Association Alerts Prime Minister

After the country’s established automotive associations, petroleum industry has also started feeling shattered. A couple of days back, PAMA and PAAPAM raised their concerns in a letter to Prime Minister Shahbaz Sharif. However, in a recent update, Oil Marketing Association (OMA) did the same.

OMA has alerted the Premier of imminent collapse of petroleum industry.  Chairman of the Association Tariq Wazir Ali, in a communication to PM Shahbaz Sharif, sought a help to recover losses amounting to a staggering 26 billion rupees (over $120 million).

Currency Fluctuation: Billions in Losses 

This financial burden arises from deficiencies in the current mechanism for recovering foreign exchange gains and losses. Ali emphasized the urgency of addressing this issue to safeguard the industry from further financial strain and ensure its continued contribution to the national economy.

While acknowledging the government’s efforts to stabilize the economy, Ali expressed hope that a swift resolution to this specific problem would further strengthen economic stability. A robust oil industry benefits various sectors, and its smooth operation is crucial for the nation’s well-being.

Finalization of Recovery Mechanism

OMA Chairman Ali expressed concern about the Ministry of Energy’s delay in finalizing the proposed mechanism for recovering exchange rate fluctuations. This delay exposes the industry to potential vulnerability in the face of future currency movements.

“We urgently request your intervention to expedite the finalization of the proposed mechanism,” Ali urged the Prime Minister. A timely resolution is critical to mitigate the ongoing financial risks faced by the petroleum industry.

It’s important to note that oil refineries have previously voiced similar concerns, emphasizing the need for a system that ensures full recovery of actual currency exchange losses. Decisive action is paramount to ensure the industry’s stability.

Pakistan’s economic well-being hinges on a healthy oil industry. If oil companies continue to face significant financial losses due to unrecovered foreign exchange losses, their ability to operate effectively could be jeopardized. This scenario could lead to fuel shortages and price hikes for consumers, further impacting the economy.