OGRA Asks Govt to Increase Margins for OMCs, Dealers

The Oil & Gas Regulatory Authority (OGRA) has recommended increasing margins for oil marketing companies (OMCs) and petroleum dealers. In a letter to the Petroleum Division, OGRA proposed raising the margin on high-speed diesel (HSD) and MS petrol for OMCs from Rs. 7.87 per litre to Rs. 9.88 per litre. For petroleum dealers, the Authority has asked to raise the margin from Rs. 8.64 to Rs. 10.01 per litre for both HSD and MS. OGRA said the proposed margin adjustment includes an additional Rs. 0.5 per litre for OMCs and Rs. 0.25 for dealers to cover expenses linked to the digitalization and automation of fuel pumps over the next three years. The oil sector has been advocating for higher margins to offset financial pressures. According to the Oil Companies Advisory Council (OCAC), the industry faces significant challenges such as fuel smuggling, high financing costs, sales tax exemptions, and insufficient margins. In its recent letter to OGRA, OCAC emphasized that the current margins are outdated, with the last adjustment made in September 2023.