Blame put on sup­ply chain for fuel cri­sis

The Financial Daily - - FRONT PAGE -

TFD Mon­i­tor­ing IS­LAM­ABAD: The com­mis­sion set up by the prime min­is­ter to in­ves­ti­gate the 10-day oil cri­sis which al­most paral­ysed the coun­try this month has blamed al­most the en­tire oil sup­ply chain, in­clud­ing the min­istries of power, pe­tro­leum and fi­nance, Oil and Gas Reg­u­la­tory Author­ity (Ogra), the man­age­ment and board of Pak­istan State Oil (PSO), mar­ket play­ers and Pak­istan Na­tional Ship­ping Cor­po­ra­tion (PNSC) for the acute fuel short­age.

The two-mem­ber com­mis­sion com­pris­ing Zahid Muzaf­far and Za­far Ma­sud rec­om­mended struc­tural re­forms in the en­ergy sec­tor and main- tain­ing above 300,000 tons of fuel stocks at all times to cover at least 20 days of con­sump­tion.

Mem­bers of the com­mis­sion con­sid­ered close to Fi­nance Min­is­ter Ishaq Dar called for ac­tion against the chair­man and mem­ber of Ogra, rep­ri­manded the PNSC man­age­ment and fixed di­rect re­spon­si­bil­ity on eight of­fi­cers of the pe­tro­leum min­istry and PSO.

The in­quiry re­port avail­able with Dawn also ac­cused what it de­scribed as the black sheep in the oil in­dus­try - oil mar­ket­ing com­pa­nies (OMCs) and deal­ers - of be­ing in­volved in hoard­ing and black mar­ket­ing of petrol. It sug­gested di­ver­sion of at least 50 per cent power sec­tor bills and tar­iff dif­fer­en­tial sub­sidy to the PSO to avoid sim­i­lar cri­sis in fu­ture. It also ac­cused the Oil Com­pa­nies Ad­vi­sory Coun­cil (OCAC) of hav­ing been neg­li­gent.

The re­port said the cri­sis had been brew­ing for quite some time and "surely a re­sult of struc­tural is­sues and not only an event-driven sit­u­a­tion", adding that some is­sues needed to be fixed ur­gently while struc­tural is­sues could be tack­led in medium to long-term.

The is­sues iden­ti­fied by the re­port in­cluded poor man­age­ment prac­tices, sys­tems and man­age­ment in­com­pe­tence at the PSO, in­abil­ity to ap­pre­ci­ate the ex­tent of the po­ten­tial is­sue

See # 6 Page 11

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