Systematic petrol hoarding at its peak 

Minister says it’s Ogra issue; Authority claims punitive steps under way; PSO claims short supply at filling stations was due to expectation of price increase; leading OMC official says no shortage at national level

LAHORE: In anticipation of a hike in the prices of petroleum products from June 1, the fuel supply is being curtailed systematically by oil marketing companies (OMCs) and dealers to mint money, The News has learnt.

A sporadic occurrence of petrol shortage is being witnessed in the provincial metropolis and other cities for about a week. Brief stoppages in the sale of petroleum products are being seen at various petrol pumps every second day. The owners of some of the pumps have preferred to partially close the sale. According to a dealer, the supply of motor fuel has been curtailed by about 20-30 percent by the OMCs to hoard petrol for selling it at higher rates after June 1.

The problem of short petrol supply has invited stakeholders of petroleum sector to indulge in a fierce blame game. The Ministry of Petroleum and Natural Resources, the Oil and Gas Regulatory Authority (Ogra) and the downstream petroleum sector have accepted the menace of petrol hoarding. However, different stakeholders have different stories about what is actually irritating hapless commuters nowadays. The Ministry of Petroleum blamed the OMCs and dealers for wrongdoings and expressed its inability to take any action without a mandate. It was the responsibility of the Ogra to take action against the culprits, said a senior official of the Ministry of Petroleum.

On the other hand, the petroleum sellers accused the Ministry of Petroleum and OMCs for the short supply of fuel. The ministry just didn’t want to take action against the OMCs, said a dealer.

A leading OMC and main importer of fuel in the country, while admitting the problem, dispelled the impression of any shortage of fuel at the national level.

When the attention of Shahid Khaqan Abbasi, Federal Minister for Petroleum, was drawn a few days back to the shortage of petrol that is slowly brewing up in Lahore and other cities, he said the pumps were holding back the fuel due to an anticipated price increase.

When told that even the PSO-operated pumps were found closed due to lack of petrol, he said the same thing also happened last month. About a solution to this About a solution to this problem, Abbasi said: “It's an Ogra issue. The Ministry has no tools to force the OMCs to sell petroleum products. And the OMCs appeared unable to control their dealers,” he said.

Sheikh Imranul Haq, the managing director and CEO of the state-run Pakistan State Oil (PSO), said the short supply at filling stations was due to expectation of price increase by the federal government. He, however, said the fuel stocks were adequate in the country and there was no shortage.

He said such problems would only be solved after the regulators enforced their writ. He said the solution was that the Ogra ensure all OMCs have 20 days of stock at any time in addition to pumps having all tanks filled all times.

Replying to a question, Imran said he was monitoring the availability of petroleum products at the company-operated filling stations. He asked the commuters to file complaints with their call centres if they faced any difficulty in finding fuel, assuring that he would take appropriate action.

Khawaja Babar of the downstream petrol sector accused the OMCs and the Ministry of Petroleum of creating the mess by following a go-slow policy. The ministry and OMCs cartel is responsible for the short supply of petroleum products, he said and added petrol was being hoarded in large depots. Unlike large depots, a normal filling station stocked just a few thousand litters of petrol and no owner could afford to stop sale due to variety of reasons. Only the all powerful OMCs had such leverage, he blamed.

Afzal Bajwa, Ogra spokesman, said his organisation was taking punitive steps against filling stations responsible for short supply. “We are always on a standby. We have been in process of continuously checking stocks of pumps for the last couple of months. We also hire services of a third-party to check such illegal activities,” he said.