OVER the prevailing CNG crisis, there is justification for finding fault with the petroleum ministry and the Oil & Gas Regulatory Authority. If Ogra neglected to regulate the sector and protect consumers, the ministry did not makes bid to support its recent actions, intended to discourage the fuel’s use with the help of the law. This act of Ogra invited the intervention of Supreme Court to undo the unlawful acts of the ministry. Now the ministry and the regulator are using delaying tactics over setting a fair price in consultation with the pump owners as directed by the court.
The row between the CNG station owners and Ogra aggravated when pumps in many parts of the country, including Karachi, Islamabad, Lahore and Peshawar, stopped providing gas to consumers. The owners opine that business was not feasible at existing prices and the warning from Ogra also failed to dissuade them. As both pump owners and the regulator stick to their positions, hopes of an accord on the fuel’s new price before Dec 5 as ordered by the apex court have dimmed.
While directing the govt to de-link CNG prices from petrol and revert to the half-yearly price revision mechanism, the apex court had also invalidated illegal operating costs charged by the owners. Consequently, CNG prices came down 31 per cent. Ever since, the pump owners and the government have not been able to work out a new price. In fact, the current stalemate suits the govt as it is optimistic that the losses would force owners to wind up their businesses, thus making gas retrieved from the transport sector available for other crucial areas like industry.
While it is hard to disagree with the aims of reducing CNG use in the wake of growing gas shortages, the government is being criticized for not devising a long-term policy for the use of this resource. This attitude resulting in heavy losses for those who had invested in CNG pumps and kits on the one hand and fast-depleting reserves on the other. For a moment, the government could slash its taxes on CNG and fix a reasonable profit margin for the pump owners to provide relief to consumers as directed by the court but government should work out a time frame for phasing CNG pumps out for both owners and users but the government has shown no sign of solving the issue. It is likely that the court will determine the fuel’s price, which could have negative consequences.