Petrol availability improves; diesel still in short supply
KATHMANDU, May 9: Petrol availability improved in the Kathmandu Valley on Wednesday, but the market is yet to return to normalcy, even though Nepal Oil Corporation (NOC) said it has stepped up distribution of petroleum products over the past few days.
NOC officials said they consistently supplied an average of 350 kiloliters (KL) of petrol every day over the past week.
As the volume is slightly higher than the normal daily demand, it has helped them win improvement in situation as well, said Linendra Pradhan, president of Nepal Petroleum Dealers´ Association (NPDA).
However, for the supply to return to normalcy, Pradhan said NOC would still need to maintain present level of output for the next few days.
“It is difficult to predict how Saturday´s closure of distribution will impact the market. Otherwise, we assess petrol supply will return to normal by Sunday if NOC continued to supply 350 KL of fuel daily for remaining days of this week,” Pradhan said.
However, both the NOC and dealers representatives could not make similar positive anticipation in case of diesel, whose supply has worsened in recent days.
“We are trying our best and have been supplying more than 400 KL of diesel for retail consumers every day for the past week,” said an official at the NOC´s Thankot Depot -- the main distribution outlet for the Kathmandu Valley.
As NOC is also making additional supply to the industries that pay Rs 98 per liter, which is higher than dealers´ retail rates by Rs 9, officials said the volume of the fuel should have been sufficient to ease the supply.
Sources, however, said NOC has slowed import as well distribution of diesel in the market as it is suffering a loss of Rs 10.6 per liter in diesel trade. “It is because of this reason that diesel shortage exists throughout the country, whereas petrol shortage exists in Kathmandu and Biratnagar only,” said the source.
Moreover, NOC as well as NPDA officials raised question over the improvement in supply of petrol lasting long, particularly as NOC has already burned Rs 750 million that it received in VAT refund to settle a portion of IOC due and import more fuel.
Ministry of Finance has informed that it is in talks with Employee Provident Fund (EPF) and Citizens Investment Trust (CIT) to lend Rs 1 billion each to NOC in order to ensure that fuel scarcity does not trouble consumers at the final hour of constitution drafting process.
However, as the talks have been held only at preliminary level and both EPF and CIT have expressed serious reservations over pledging further loans to the corporation, NOC officials doubt they will receiving the fund on time.
“We had failed to manage import in the past as well because the government did not deal with the lending procedures urgently. We fear similar situation might be seen this time as well,” said the NOC source.
But if the government acted promptly, he said NOC would be able to ensure normal supply of both petrol as well as diesel.