KARACHI: The sudden and massive jump in petroleum prices ahead of the scheduled announcement has resulted in huge inventory gains for the oil marketing companies (OMCs) as well as fuel retailers.
For the last eight days, buyers have set their eyes on the petrol pumps. They throng the pumps in huge numbers in case the government increases the rates prior to the fortnightly price change at 12am or any news swirling around in the markets regarding a possible rate hike at any time.
In this panicky situation, petrol pump owners are the main beneficiaries as buyers try their best to fill petrol in their vehicles or take it in plastic containers – often used cooking oil and soft drink bottles – at a reduced rate to make some savings. Not every pump offers this “sympathetic service” to consumers as it is illegal to sell fuel in containers.
Petroleum dealers usually hold a 15,000-50,000 litre capacity of petrol and diesel in their underground tanks. One can estimate instant cash earning by the pump operators even if they have half or a quarter of their underground available capacity instead of full capacity at the time of panic buying by the buyers.
If a pump owner has a combined stock of 50,000 each of petrol and diesel at old rates, then he must have made a handsome earning of Rs1.5 million easily on the increase of Rs30 per litre on both the fuels. This episode of the Rs30 per litre hike has been witnessed in the last eight days.
Talking to Dawn, a pump owner Samir Najmul Hussain did not agree that pump owners had been enjoying their hey days since both the fuel products had been raised twice by Rs30 per litre in an unconventional way rather than becoming effective from 12am with a proper announcement by the government.
He claimed that the OMCs had been rationing the supplies of diesel and petrol for the last four months, resulting in lower stocks in the underground tanks of the pumps, thus nullifying the doubts of making heaps of cash by pump owners on buyers’ excessive buying.
Many OMCs had cut supplies of fuel by 3pm and restored them after 12am since these uncertain conditions in the oil markets have emerged, he added.
He said sales of diesel and petrol remained normal on Wednesday after a big boost on Tuesday following the hint given by the Finance Minister Miftah Ismail regarding a possible jump in petroleum prices.
He said with already limited stocks, many pumps usually dry up quickly, keeping in view the huge rush of buyers. “Many people bring water coolers and buckets to get petrol at any cost,” he added.
Many pumps have been observed to take a different approach, as they usually close down the outlets to avoid any law and order situation in anticipation that the price would rise sooner or later and they could easily make a good quick buck later on available stocks.
Published in Dawn, June 9th, 2022