E-Kantipur

KATHMANDU, JAN 23 -

The public sector entity—Nepal Oil Corporation (NOC)—is finding it hard to ensure smooth supply of petroleum products even after a hefty hike in the prices on Wednesday.

Petroleum dealers’ demand for more commission, interruption in the supply due to delay in timely payments to the Indian Oil corporation (IOC), heavy NOC losses incurred in the past and increased demand of diesel due to extended load-shedding hours continue to worsen the fuel crisis. The NOC fears the shortage of diesel and liquefied petroleum gas (LPG) is likely to worsen in the next few days, while it says petrol supply is expected to be normal by Tuesday.

On Sunday, the debt-ridden NOC said that despite the price hike, the supply could not be resumed on Friday, Saturday and Sunday as dealers demanded a bigger commission and refused to distribute fuel. The issue was however, settled late on Sunday.

Petroleum dealers were demanding an additional 70 paisa and 80 paisa on every litre of petrol and diesel respectively. The dealers agreed to resume supply from Sunday evening after the Ministry of Commerce and Supplies agreed to address their demand by forming a separate committee.

NOC officials said the reason behind the short supply of diesel was its spiralling demand in the face of increased load shedding hours, while inadequate import of LPG in December led to a short supply of LPG. According to NOC’s supply reports, 478,000 litres of diesel were supplied to Kathmandu Valley on Sunday—a normal supply if the Capital does not witness panic buying. “The NOC had reduced supply of LPG in December in a bid to reduce its losses. As a result, there was a shortage of the cooking gas in the market in January,” said NOC Spokesperson Mukunda Prasad Dhungel.  The supply is feared to get worse in February as the IOC, the sole supplier of petroleum products, has reduced LPG deliveries due to a crude oil shortage at its Barauni refinery in Bihar.

What’s fuelling the crisis

•    Dealers' demand for more commission

•    Supply interruption due to delay in timely payments to the IOC

•    NOC losses incurred in the past

•    Increased diesel demand due to extended load-shedding hours

 

Posted on: 2012-01-23 08:27

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