PM Orders FIA Inquiry into Oil Companies Over Fuel Hoarding

The federal government has launched an investigation into the alleged hoarding of petroleum products by oil marketing companies (OMCs) following panic buying triggered by the ongoing regional conflict involving Iran.

Prime Minister Shehbaz Sharif has directed the Federal Investigation Agency (FIA) to probe certain OMCs as well as officials of the Oil and Gas Regulatory Authority (OGRA) over suspected stockpiling that may have constrained supply and contributed to price pressures, reported a national daily.

Preliminary findings indicate the possibility that at least one OMC deliberately withheld inventory to create artificial shortages and justify higher prices. FIA Karachi has recorded testimony from a senior official at the Directorate General of Oil who supported claims that “unscrupulous players” may have manipulated the market.

The investigation follows nationwide panic buying after the outbreak of war involving Iran, which prompted the government on March 7 to raise petrol and high-speed diesel prices to ensure uninterrupted fuel availability.

OGRA flagged the issue of potential hoarding in an April 16 letter to the government seeking approval for a Rs. 128 billion mechanism to settle price differential claims (PDC) of OMCs. The regulator said companies found guilty of hoarding would be excluded from receiving the payments, according to the letter reviewed by this correspondent.

According to the report, FIA is making rapid progress and is expected to submit its findings to the prime minister soon, potentially shaping decisions on compensation claims and enforcement action against companies found to have disrupted supply.