OCAC Criticizes OGRA for Irresponsibly Approving More Diesel Imports Despite High Stock Level

The Oil Companies Advisory Council (OCAC) has criticized the Oil and Gas Regulatory Authority (OGRA) for repeatedly approving additional imports of high-speed diesel (HSD) despite the country’s already high stock levels. OCAC recently said that OGRA’s excuses, including the upcoming maintenance shutdown of Pakistan’s largest refinery and the agricultural season, are unfounded and irresponsible. The Council argued that refinery maintenance schedules are meticulously planned, with stock levels strategically calculated to cover supply needs during shutdowns. However, these plans give no credible reason for approving extra HSD imports, especially with the country holding over 45 days of stock. Since April 2024, refineries have been renting additional storage facilities for HSD which is hurting the national exchequer. OCAC also noted that cross-border HSD inflows have already undermined local demand and made further imports detrimental to local refineries. These concerns have already been raised in Product Review Meetings (PRM) and documented by OGRA from April to July 2024, which noted the country’s high stock levels. Despite this, OGRA allowed a particular oil marketing company (OMC) to import 15,000 tons each in June and July, 40,000 tons in August, and 38,000 tons for September 2024. The council criticized OGRA’s approach, arguing that excessive imports are encouraging unfair market practices and putting undue pressure on Pakistan’s foreign exchange reserves. OCAC called on OGRA to prioritize the integrity of the national oil supply chain and halt unnecessary imports which are creating unfair competition and harming the local oil industry.