Recommends the population not to pay attention to rumors, since the oil supply situation in the country remains stable
People wait their turn to get fuel at a gas station in Karachi, Pakistan, on June 2, 2022. Photograph taken on June 2, 2022. PHOTO: REUTERS
The government on Thursday ordered all provinces to instruct deputy commissioners (DCs) to carry out inspections within their respective jurisdictions to monitor illegal hoarding of petroleum products for profit, as tensions in the Middle East continue to rise.
The statement came in the wake of reports citing an oil shortage in the country. Leaders of the Pakistan Petroleum Dealers Association (PPDA) have raised the alarm, alleging that oil companies have reduced supplies and warning that petrol pumps could begin to close in the coming days if supplies are not restored.
Central Punjab President Nauman Majeed claimed that petrol supply has also reduced by 50%. He alleged that some private companies had started hoarding petroleum products.
A statement issued by the Oil and Gas Regulatory Authority (OGRA) highlighted concerns over possible hoarding attempts, with reports suggesting that some elements may take advantage of the current situation to profit from fuel shortages.
“To curb such practices, all provincial chief secretaries have been asked to direct deputy commissioners (DCs) to carry out inspections within their respective jurisdictions. Any premises found involved in illegal storage of petroleum products will be sealed and action will be taken in accordance with the law,” the OGRA said.
Meanwhile, OGRA teams are actively monitoring the situation on the ground. Inspections are carried out at petroleum depots and retail outlets to ensure smooth supply of petroleum products and prevent malpractices.
“The public is advised not to pay attention to rumors and continue with normal consumption patterns as the oil supply situation in the country remains stable,” the statement added.
The government has assured citizens that the country has sufficient reserves of petroleum products to meet domestic demand and that there is no need for panic buying or hoarding.
Read more: Iran war: Pak plans to import oil through Red Sea
“In view of the prevailing geopolitical situation, the authorities are closely monitoring the petroleum supply chain to ensure uninterrupted availability of products across the country. The current stock situation remains comfortable and within the prescribed requirements,” the OGRA said.
The authority also emphasized that strict action would be taken against any individual or entity found involved in illegal hoarding or storage of petroleum products at unauthorized locations, particularly at locations other than licensed petroleum depots and retail outlets of Oil Marketing Companies (OMC).
Oil for 28 days
The Oil and Gas Regulatory Authority has already clarified that they have high oil stocks to cover the country’s 28-day consumption needs, after preventive measures to import surplus fuel.
However, due to the attack by the United States and Israel against Iran, two shipments of crude oil were trapped after the closure of the Strait of Hormuz. This canal is 33 kilometers (21 miles) wide and a fifth of the world’s oil passes through it.
Last year, the Strait of Hormuz was used to transport an average of 20 million barrels of crude oil, condensate and fuel per day. OPEC members such as Saudi Arabia, Iran, the United Arab Emirates, Kuwait and Iraq depend on this sea route to export most of their crude oil, mainly to Asia. “We have ample stocks of gasoline and diesel to meet the country’s needs,” officials said, adding that the country could meet consumers’ fuel needs for 28 days.
However, the government has planned to import oil through the Red Sea from Saudi Arabia and the United Arab Emirates (UAE) due to the closure of the Strait of Hormuz, while also moving to a weekly oil price review mechanism.
Also read: Fuel saving plan unveiled as Iran war chokes supplies
Sources said The express PAkGazette that the government is currently working on several measures to ensure uninterrupted oil supplies amid the war between the United States, Israel and Iran.
Pakistan imports around one million barrels of oil monthly, with Saudi Arabia being a key oil exporter to the country. The United Arab Emirates also exports oil to Pakistan.
Sources said UAE-based ADNOC and Saudi Aramco will supply oil to Pakistan bypassing the Strait of Hormuz. One refinery has already imported some shipments through the Red Sea. A couple of oil tankers have arrived in Pakistan, while others are on their way.
As another measure, the government plans to change the oil price review from the current fortnightly system to a weekly review. The objective is to discourage hoarding of petroleum products by traders.
Sources said the government had projected a possible increase of Rs 50 per liter in oil prices following the recent war in the Gulf region.
