PTI govt to expand inquiry against OMCs

ISLAMABAD:

The government is set to expand the scope of inquiry against oil marketing companies (OMCs) to probe the shortage of petroleum products in June 2020.

The Cabinet Division has moved a summary to the cabinet for constitution of a commission of inquiry to investigate the shortage of petroleum products in its meeting scheduled for Tuesday.

This will be the third inquiry to be conducted by the government into the petrol crisis, which occurred in June when different OMCs curtailed oil supplies to their retail outlets, shifting the entire burden on Pakistan State Oil (PSO).

It was also shocking for the government as the market saw a 90% hike in demand for petrol during the month, despite consumers facing a shortage. The government claimed that there were 1,500 illegal petrol pumps across the country and petroleum products were hoarded by the OMCs there to pocket money from the consumers.

The government raised the petrol price by over Rs25 per litre on June 26 unexpectedly and oil supplies at retail outlets of all OMCs were restored soon after the announcement.

The government believed that petroleum products were stored by the retail outlets of all the OMCs, which became available soon after the increase in prices of petroleum products for the month of July.

Earlier, the government had formed a committee, headed by the director general (DG) oil and comprised a representative of the Federal Investigation Agency (FIA).

The Oil and Gas Regulatory Authority (Ogra) imposed a penalty of Rs55 million on several OMCs for the oil shortage in the country. These companies included Shell, Total Parco, Puma Energy, GO, Hascol, Attock, Byco, Askar and BE Energy.

This committee informed the prime minister that nine companies were involved in oil hoarding that led to the shortage.

Prime Minister Imran Khan constituted another four-member committee to probe the shortage of petrol and fix responsibility.

The committee, led by Shahzad Qasim, Special Assistant to the PM, comprised former Ogra member Rashid Farooq, Petroleum Institute of Pakistan CEO Asim Murtaza and former PSO executive Naazir Abbas Zaidi.

This committee is investigating the petroleum products’ shortage. Meanwhile, the Cabinet Division has tabled a summary before the cabinet to form a commission for this purpose.

Due to reduction in oil prices in June, OMCs curtailed supply to retail outlets to avoid inventory losses. Hence, the burden shifted to PSO whose market share in petrol sales stood at 34.6% between January and April 2020, but it went up to 54.4% in June 2020. Similarly, PSO’s share in high-speed diesel supply was calculated at 39.7% in January-April 2020, which swelled to 64.3% in June 2020.

Related posts

Leave a Comment