Dealers accuse oil firms of withholding supply

KARACHI: Senior Vice Chairman of the Pakistan Petroleum Dealers Association Malik Khuda Bakhsh has alleged that oil marketing companies (OMCs) are not supplying petroleum products to dealers as per demand, citing the ongoing Iran-Israel conflict as a trigger for the disruption.

In a statement, Bakhsh said OMCs are failing to deliver fuel to petrol pumps in line with their orders. He noted that the Oil and Gas Regulatory Authority (Ogra) has directed companies to maintain a mandatory stock level of 20 days, as required under their operating licences.

He asserted that while there is no shortage of petroleum products in the country, some OMCs are attempting to capitalise on regional instability by curtailing supply, anticipating a possible spike in fuel prices.

According to Bakhsh, Karachi’s daily petrol demand stands at 2,500 metric tonnes, and OMCs currently have reserves sufficient for over 20 days. He emphasised that there is no overall shortage in Karachi, but some pumps operated by a particular company have run dry due to a failure to supply its dealers.

He reiterated that, under Ogra standards, national petroleum reserves are currently adequate.Bakhsh urged the government to take immediate steps to prevent oil companies from creating an artificial shortage. “In case of fuel shortages, it will be ordinary people that suffer and the government that faces the backlash,” he warned.

Geo adds: Sources at Pakistan State Oil (PSO) confirmed the company has decided not to supply more than its average daily sales and is working on a strategy to maintain regular fuel supply.

The sources also stated that a vessel carrying 70 million litres of fuel is set to depart from Fujairah for Karachi Port today.It is worth noting that following US strikes on Iranian nuclear facilities, Iran’s parliament on Sunday approved a motion to close the Strait of Hormuz -- though the final decision rests with the country’s top security council.

Roughly 21 million barrels of oil per day pass through the Strait of Hormuz from Saudi Arabia, the UAE, Kuwait and Iran to other countries, including Pakistan, China, Japan, South Korea, Europe, North America, and others worldwide.