BPC moves to rein in additional demand

Diesel sales have witnessed a drastic surge throughout the past week on the heels of a planned load shedding enforced across the country.

Fuel oil dealers held the additional use of oil-run generators responsible for the scenario. Besides, some people are storing up the fuel oil being driven by a speculated crisis while some are taking increased amount of fuel in their cars.

The oil supplier companies are now trying to rein in the rising demand.

Three state-owned oil companies – Padma Oil Company, Meghna Petroleum Limited, and Jamuna Oil Company Limited – regularly supply fuel to the authorised dealers. Later, the dealers sell diesel, petrol and octane through their own and affiliated pumps at the retail level across the country.

The pump traders said the demand for diesel rose by 20 per cent within a week while that of octane and petrol went up 10 per cent. It prompted them to place an increased requisition, but the suppliers verbally said on Monday that they would not meet the additional demand.

If a dealer has a demand for 50,000 liters, it will be provided with a maximum 35,000 liters, said the traders.

Nazmul Islam, manager of Salek Motors in Rangpur city, said their daily sales volume of diesel was 400 to 450 liters, but it now goes up by 150 liters.

However, the sales of petrol remain unchanged, he said, adding that his pump has enough stock of fuel oil and there is no crisis.

Mizanur Rahman, secretary general of a faction of Bangladesh Petrol Pump Owners Association, said his petrol pump on the Mawa expressway was supplied 40,000 to 45,000 liters of fuel last week, but the supplier – Padma Oil Company – limited the quantity to 27,000 liters this week.

He, a dealer of Padma Oil and Meghna Petroleum, also disclosed that other petrol pumps also received the low supply notifications.

Bangladesh Petroleum Corporation (BPC), the fuel market regulator, is now looking for the reasons behind the sudden increase in sales of diesel and other fuels. The three state run oil companies, which operate under the BPC, have also joined the effort.

Officials of the oil companies said there might be various manipulations behind the sudden increase in demand. Therefore, an initiative has been taken not to supply additional fuel oil without a rational explanation.

However, BPC chairman ABM Azad told Prothom Alo that no decision has been taken yet to slash fuel supply.

Describing the sudden increase in demand as unexpected, he said there might be various factors behind it and this is why the authorities now carry out a scrutiny before supplying fuel against an additional demand. It is a part of routine work at the oil companies.

Diesel-run generators are being used increasingly in residential and commercial buildings to generate electricity amid repeated load shedding. A resident of Uttara in Dhaka, on condition of anonymity, said they used to run generator less than 30 minutes a day before the enforcement of the planned load shedding. Now they have to run generator for several hours a day.

He also disclosed that he stored up some 250 liters of diesel due to a fear of crisis and price hike.

Another resident of the capital said that his generator now consumes 30 liters more fuel to provide electricity to his 14-storey building.

A distributor who supplies fuel to an upscale hotel in the capital said on the condition of anonymity that the hotel used to take three drums of diesel after every two days. Now they have been taking two and a half drums of diesel a day over the past week.

Two of three factories of Fatullah Apparels in Narayanganj have their own captive power plants. Fazle Shamim Ehsan, proprietor of the company, told Prothom Alo that they are facing gas supply shortage during daytime, in addition to a daily power cut of 2.5 to 3 hours.

The three factories are now consuming more than 1,500 liters of diesel a day, he said.

He recalled the good old days, saying that once a generator went out of order as it was sitting idle for long due to absence of load shedding.

Owners of the industrial factories said the short supply of gas does not allow them to run the captives all day long. They only can operate the plants from 10:00pm to 9:00am when the pressure of gas remains normal.

The situation forced them to produce electricity through generators while the factories with no captive are using generators during power cuts, which is eventually pushing up the diesel consumption.

Shariful Reza, general manager of Sparrow Garments in Gazipur's Lakshmipura area, said earlier there was maximum load shedding of half an hour a day, which now reached four to five hours on average. It has increased the overall diesel consumption.

His factory used to consume 500 liters of diesel a week, but the consumption now reached 1,500 to 1,600 liters per day. Apart from this, it needs 500 to 600 liters of diesel to run the boilers in the factory amid a short supply of gas.

During a visit to three pumps in Sylhet on Monday night, it was learnt that the depots have already stopped supplying diesel as per demand. Swapan Kanti Das, manager of Jalalabad CNG Station in Ambarkhana area, said they used to collect 14,000 to 15,000 liters of diesel every week, but the supply now fell to 5,000 liters.

The petrol pump owners said that the customer demand cannot be met with the decreased supply. They will have to provide less fuel to the customers, which may create an environment of fear.

However, several BPC officials said the government has suspended operation of all diesel-run power plants since last Tuesday to save fuel. There is no reason to fear as the country has no deficit in fuel stock while the imports are also regular.

Nazmul Haque, president of Bangladesh Petrol Pump Owners Association, said increased use of generators and panic-buying by a quarter pushed up the fuel demand by 20 per cent.

Against such a backdrop, the oil companies have assessed the average demand of petrol pumps using data from the last three months. Now, they will supply fuel to the pumps as per their average demand.