Ahmed Mukhtar Naqshbandi
ISLAMABAD/KARACHI: Pakistan is experiencing a petrol crisis, with only four major oil marketing companies (OMCs) holding 90% of the petrol stock, while the rest are not importing the fuel due to exchange losses.
The country is suffering from a petrol shortage, with Punjab, the most populous province, bearing the brunt of the crisis. The major fuel is unavailable in the province’s major and smaller cities, villages, and towns.
The crisis has worsened recently, despite the government warning citizens not to stockpile petrol in anticipation of a price increase in the following fortnightly review, scheduled for February 15, 2023.
According to sources in the country’s oil sector, the oil marketing companies, the government, and petroleum dealers are all to blame. They pointed out that most businesses were not importing gasoline due to exchange losses, which the government had adjusted only partially and in phases.
Petrol crisis worsened recently
They claimed that smaller OMCs did not even have a 20-day supply of petrol because they were not importing it due to exchange rate concerns.
Only Shell Pakistan, Total Parco, Pakistan State Oil (PSO), and Attock Petroleum were importing gasoline, and these four companies own 90% of the stock. There are approximately 50 OMCs in the country; some have limited stock, while others have run dry.
An OMC official inquired who would import gasoline when there were concerns that exchange rate losses would not be adjusted and would take time to be repaid. According to sources, aside from most OMCs’ low import of petrol, petroleum dealers were also having a field day and were engaged in hoarding petrol in anticipation of the expected price increase by mid-February.
The ex-refinery price of gasoline is rising primarily due to the massive dollar appreciation against the rupee. According to oil industry sources, dealers are taking advantage of the situation by hoarding to order to profit from it. The government’s policies, particularly those relating to taxation on petroleum products, have also contributed to the petrol shortage.
According to the sources, if the government must raise taxes on petroleum products, it should do so immediately rather than waiting for the fortnightly review, which allows hoarders to profit greatly from the situation.
