Pakistan running out of diesel

June 18th, 2008 - 2:25 pm ICT by IANS  

Islamabad, June 18 (IANS) Diesel supplies across Pakistan have begun drying up, largely due to a squeeze caused by a payments crisis, and some 15 percent of outlets in the country have stopped selling the fuel. The worst affected is the North West Frontier Province (NWFP) - but in this case the crisis has been caused by the smuggling of diesel into Afghanistan, where its price is much higher than in Pakistan.

A number of factors were responsible for the crisis, Dawn said Wednesday, quoting an official of the government-run Pakistan State Oil (PSO).

The government was not releasing the petroleum development levy (PDL) to the oil marketing companies; they, in turn, were defaulting to refineries; and these were defaulting to the importers.

“Thus, there is a crisis-like situation in the entire oil supply chain,” Dawn noted.

The government owes Rs.65 billion to PSO alone, while three private majors - Total, Caltex and Shell - “have also put the government on notice”, the newspaper added.

As of now, only PSO is partially supplying diesel and even its supplies are dwindling fast.

With supplies down to 50 percent, some 15 percent of the outlets in the country had already gone out of business and others were shutting down on a daily basis.

“Petrol stations are going out of operation on a daily basis and the country could see a crisis if the situation is not retrieved within a few days,” Dawn said.

According to Petroleum Dealers’ Association secretary general Zakir Qureshi, the oil marketing companies had simply stopped supplying diesel to petrol stations without citing any reason - in spite of the fact that the owners of the outlets paid up in advance.

The companies were neither supplying diesel nor laying down a timeframe for restoring supplies, Qureshi added.

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