Petrol's slippery slope.

AFTER a month of wrangling, the aggravated shortage of petrol at pumps around the country is finally set to be resolved as the government retreats from its position and has agreed to raise prices at the pump by a near historic amount. The shortages arose once the government reduced prices in May, at the insistence of Prime Minister Imran Khan who said he wanted to bring down fuel prices in a bid to curb inflation and pass on to the public the benefits of lower international oil prices. But the move sparked immediate protests from oil companies and refineries who argued that the downward price revision had been made on the basis of month-old prices, and the prevailing international prices, as well their direction, at the time were sharply upward. It would not be possible for them to arrange cargo deliveries in the month of June at the price the government had notified in May, they said.

On the last day of May, the government notified a second decrease, and the minister petroleum - Mr Omar Ayub - went on the offensive on the media calling the oil companies a 'mafia'. This aggressive turn in the sequence of events was followed up by law-enforcement action against oil executives after they were accused of 'hoarding' supplies. Through all this, oil imports slowed to a trickle and supplies ran short around the country, creating long lines and dry-outs at pumps. The dispute dragged on all through June as consumers jostled for space at the pumps. The oil industry held its ground that...