Byco, Askar and BE Energy fined Rs. 5 million each for creating ‘artificial fuel shortage’
The Oil and Gas Regulatory Authority (OGRA) on Monday imposed a fine of Rs. 5 million each on three oil marketing companies after finding them guilty of creating an artificial fuel shortage earlier this month.
“OGRA imposed a penalty of Rs. 5 million each on Byco, Askar and BE Energy on show-cause notices issued during oil shortage crisis earlier this month,” OGRA spokesman Imran Ghaznavi posted on Twitter.
Long queues were witnessed outside filling stations across Pakistan after the government, on the behest of Prime Minister Imran Khan, reduced fuel prices on June 1. Rather than the price drop helping consumers, it actively hurt them because the oil marketing companies claimed they had no fuel stocks, with many overcharging consumers for higher-grade fuel rather than selling them petrol at advertised rates.
Taking notice of the shortage, the government launched a probe and found that oil marketing companies had colluded to create an artificial shortage in order to not sell stocks at the reduced rates. The shortage, which continued sporadically throughout this month, ended as soon as the government increased fuel prices to their current rate, with the price of petrol alone being raised from Rs. 74.52/liter to Rs. 100.10/liter.
According to a preliminary report into the shortage compiled by the Petroleum Division, BE Energy, Btco and Askar were accused of hoarding petrol from June 1 to June 10. It said that the market share of BE Energy dropped to 0.2 percent in the first 10 days of June against 2.3 percent on May 20 despite having a stock of 8,697 metric tons.
Similarly, Byco’s market share dropped to 2.2 percent from 3.6 percent against a stock of 413 metric tons, while Askar had a stock of 7,387 metric tons.