Petroleum blame game fuels vicious circle

Nepal’s petroleum business — NOC to tanker operators/drivers to fuel stations — has become so complicated that it only fuels a vicious circle, just as consumers continue to suffer.

On March 25, when the Nepal Bureau of Standards and Metrology was conducting regular market inspection of fuel pumps, it found Sanjay Service Centre in Sundhara, selling less fuel than what customers paid for.

The fuel station was robbing customers of 150 ml of fuel in every five litres of petrol and diesel, or 30 ml in each litre, which was 10 times more than the legally permissible amount. The existing law allows deficit of up to 15 ml on sales of every five litres of fuel or up to 0.25 per cent if the quantity is above five litres. NBSM then immediately suspended the fuel station’s business for one-and-a-half months. NBSM must have done its duty, but the fuel station’s unethical practice meant customers were losing at least Rs 4 on purchase of every litre of petrol and at least Rs 3.2 on purchase of every litre of diesel. The pump was making extra buck on top of dealer commission of Rs 2.89 and Rs 2.04 extended by Nepal Oil Corporation on sales of every litre of petrol and diesel, respectively.

“We know many fuel stations are ripping off customers by tampering their meters. We are trying to control these malpractices. But these events are taking place despite conducting market inspections every now and then,” said Bishwo Babu Pudasaini, Deputy Director General of NBSM.

This fiscal year alone, NBSM has taken action against around 30 fuel stations for selling less fuel by tampering their dispensers, with Siddhartha Oil at Jadibuti robbing customers of 53 ml of fuel on sales of every litre of petrol and diesel. “During informal discussions, the owners of these pumps told us that they had to resort to these tricks because tankers dispatched by NOC supply less fuel than pledged,” Pudasaini said. The Nepal Petroleum Dealers’ National Association also shared similar view. The claims could not be independently verified by THT, but nonetheless the possibility of pump owners engaging in such acts to maximise profit cannot be ruled out.

“To bring the situation under control, NOC must first offload the fuel brought from India and refill the tanks after carrying out proper measurements,” Lilendra Prasad Pradhan, President, NPDNA, said. NOC currently uses tankers, almost all of which belong to the private sector, to transport oil from the depots of Indian Oil Corporation.

“Once tankers arrive at our depots, we break the lead seals put by IOC and check the quantity of oil thoroughly,” NOC Spokesperson Mukunda Ghimire said, adding, “It’s a foolproof system and we fine drivers immediately if they are caught delivering less amount of fuel.” After these checks, NOC asks some of the trucks to offload the product at its depots and sends the rest directly to fuel stations. “If products have to be sent directly to fuel stations, we ask pump representatives to be present at our depot to conduct the measurement,” Ghimire said.

But petroleum dealers claimed that NOC invites pump representatives ‘just for formality’.

“Our representatives there can do nothing. They have to agree to whatever NOC officials say. So, NOC can always say they have dispatched certain quantity of fuel, even when the actual amount may be short of that,” Pradhan said. “We want the oil company to fully offload what has been brought from IOC before delivering it to us.”

Dipak Subedi, Spokesperson for the Ministry of Commerce and Supplies, said that the ministry was mulling over petroleum dealers’ association’s request.

When it comes to oil, the blame game continues, but if the concerns of the biggest victim — the consumers — were to be addressed, concrete measures, not just snake oil, are required immediately.

At the receiving end

• The existing law allows deficit of up to 15 ml on sales of every five litres of fuel or up to 0.25 per cent if the quantity is above five litres

• Fuel stations have been found robbing customers of 150 ml of fuel in every five litres of petrol and diesel, or 30 ml in each litre, which is 10 times more than the legally permissible amount

• At given rate of cheating, customers lose at least Rs 4 on purchase of every litre of petrol and at least Rs 3.2 on purchase of every litre of diesel

Source: THT