POL prices: product is international, problems are local. Frequent price hikes of petrol have put our colleagues in the newsroom in big trouble: how to report the issue with an innovative, yet factual headline.
It is not that they are short of words or have run out of expressions. They want to put in the essence of the public reaction to the new prices.
Instead of the prices, the government becomes a punching bag.
Whenever the government increases the petroleum prices, the media has a field day reporting the rage of the people. That day is difficult for the government officials to come to TV screens or talk to a newspaper reporter to defend the government.
The devil in the details, which neither the government is willing to explain nor is the media willing to learn and disseminate.
Now, the social media has started commenting that the problem stems from the media’s as well as the commoners’ lack of understanding of POL prices’ mechanism and government’s dependence on POL taxes to raise revenues.
Last week, the prices of petroleum products went up for an eighth time since the announcement of the federal budget of 2021-22 on June 11. The POL prices are not mandated by the budget document as the issue is exclusively dealt by the Oil and Gas Regulatory Authority. The fresh round of the price raise gets petrol prices to an all-time high and the biggest per liter increase in one go.
The public needs to understand that petrol is not a local luxury. Pakistan incurs huge import bills in terms of POL to other countries. Similarly, whenever there is an increase or decrease of POL prices in the international market, all countries importing the oil products have to bear the impacts. Currently, oil prices are on fire after a brief slump last year in the peak Covid times and later on due to short oil supply by the OPEC plus.
But the public at home is hardly concerned with OPEC plus politics and policies. They are already burdened with massive taxes – both direct and indirect – and the recent increase in POL prices will simply add troubles to their daily life-related struggles. Fuel is the most essential part of an economy. It drives the whole society. Almost every sector is dependent on fuel, such as agriculture, road transport, air transport, electricity and water sector, trade and manufacturing sector etc. A fuel price hike would inflate other sector production costs, raising the costs of goods and services in the country. Thus even the most essential products or goods such as fruits, vegetables, sugar, wheat and eggs etc. will witness a price rise. Such goods make up a major portion of a consumer basket of an average person, hence raising the pressure on them. Therefore, this hike will most definitely raise the prices of goods and services in the country, where people are already witnessing a month-on-month increase in the rate of goods.
However, certain groups benefit greatly from the rise in petroleum prices. These are the oil marketing companies which make use of such situations for their own advantage. During the days leading up to the increase, the suppliers decide to restrict the supply, building up stocks till the announcement of the increase. As the new prices take effect the petrol stations flood the market, making huge sales and consequently more profit.
The government itself has been under pressure as the increase in fuel prices comes following the continuous rise in prices in the international market. However, the government can ease the public’s burden from the ever-increasing prices and inflation through offering relief services because currently the rising prices, the rising taxes, all within a pandemic, continue to erode the purchasing power of a common man.
Coming back to reporting petroleum prices, long story short, the media should be aware of the realities, politics and economics of the market. This piece presents a layman’s argument, who spends most of his time in a newsroom.
Over to market experts, now!