OMAP to get full banking support: Baqir

LAHORE: State Bank of Pakistan Governor Reza Baqir has assured central bank’s full support in resolving issues of Oil Marketing Companies (OMCs) and promised to organise a meeting of the Oil Marketing Association of Pakistan (OMAP) with the Pakistan Banks Association (PBA).

A delegation of OMAP office bearers including Chairman Tariq Wazir Ali, Senior Vice Chairman Tariq Mehmood, and Vice Chairman Ahsan Majeed called upon the SBP governor. Deputy Governor Dr Inayat Hussain, Director Jahangir Shah and Chief Operating Officer of Gas and Oil Pakistan Zeeshan Tayyeb were also present on the occasion.

OMAP chairman informed the governor about the issues being faced by the OMCs. He demanded that banks should be instructed to provide trade finance facilities in line with volume, oil price relevant to the procurement period, FX rates, agree periodic revision in limits based on prices and should provide competitive pricing in view of high-volume low margin OMC business.

He emphasised the importance of banking sector’s support to the OMCs and requested the SBP to look into the issues of forward cover, trade finance facilities and foreign exchange losses suffered by the industry.

Ali also informed that after stagnant sales of petrol and diesel in calendar year 2020, 2021 proved to be a year of growth for the petroleum industry and the economy of Pakistan. Sales of petrol and diesel in calendar year 2021 of approximately 17.19 million tonnes, compared with 14.98 million tonnes in CY 2020, posted a massive growth of 15 percent.

This was despite the fact that the government had to increase prices in view of higher prices of petrol and diesel in the international market.

He went on to say that the prices of petrol and diesel in Pakistan still remained well below other countries because the government has reduced taxes to provide relief to the common man.

“It is expected that this growth will continue in 2022 and the economic activity generated from higher fuel sales will provide much needed employment opportunities to the public,” he added.