Axe to fall on ‘invisible hand’

• Finance Minster Dar says ‘conspiracy’ being hatched to destabilise government
• Sources say ministries of finance and water and power failed to take action despite repeated warnings by sacked PSO officials asking for funds to buy petrol
• Ministers for finance and water and power absolve themselves of responsibility, reject impression that they failed to act on crisis intimations
• Petroleum minister says govt has decided to import 680,000 metric tonnes of petroleum products within the next two weeks and situation will normalise within two days

Despite a massive embarrassment in wake of the country’s worst petroleum crisis, three top cabinet ministers – Finance Minister Ishaq Dar, Water and Power Minister Khwaja Asif and Petroleum Minister Shahid Khaqan Abbasi, managed to escape the “wrath” of the “angry” Prime Minister Nawaz Sharif Monday during a meeting held to fix responsibility for the unprecedented petrol shortage in Punjab and other parts of the country. However, a low-level probe committee was formed by the premier to probe the matter.

Several cabinet members thought that the premier’s mood suggested that either Dar or Abbasi would be shown the door, however, no significant action was taken.

Dar and Abbasi addressed separate press conferences to clear their positions over the crisis. The situation suggested that the formation of probe committee was announced to hush-up the probe and for taking action against some low-cadre bureaucrats.

Not only did Dar and Abbasi manage to survive but both also made an effort to save each other’s job. Dar even shocked the journalists by stating that a “conspiracy” was being hatched to destabilise the government in the wake of petrol crisis.

PM Sharif cancelled all his official commitments for Monday and dedicated the day only for clearing the mess and punishing those responsible for the petroleum shortage. However, the three cabinet ministers managed to conclude that neither of them was responsible for the mess.

Apart from ministers of finance, petroleum and water and power, Punjab Chief Minister Shahbaz Sharif, Ministry of Water and Power secretary, acting Petroleum Ministry secretary and other senior officials attended the meeting.

WE’RE DOING OUR BEST:

The prime minister expressed his “extreme displeasure” over the petrol crisis. He was informed that measures were being taken to provide immediate relief to the people as 15,600 metric tonnes of petrol was supplied Monday to Punjab against an average daily consumption of 12,000 metric tonnes.

The prime minister was informed that additional supply of petrol would be ensured in the coming month.

Talking about power situation, the prime minister directed the Ministry of Water and Power to immediately work to reduce line losses and recover outstanding amount of over Rs 500 billion in order to clear the amounts due to Pakistan State Oil (PSO) and other liabilities.

DAR SAYS HIS HANDS ARE CLEAN:

Before the meeting, Senator Dar was first to claim innocence.

Addressing a press conference, Dar not only claimed that his ministry had nothing to do with the crisis, but also said that a “conspiracy had been hatched to embarrass and destabilise” the government. However, he admitted that there was “some mismanagement” on the government’s part which triggered the petrol crisis.

The minister also lashed out at critics who held the Finance Ministry responsible for the mess, stating that the ministry had not stopped any letter of credit (LC) of PSO. He also dispelled the impression that the petrol crisis was linked to an inadequate supply of funds.

“The Ministry of Finance does not purchase oil and we have no business with the PSO,” he said, adding that the Finance Ministry extended support to PSO whenever it asked for it. He also said that his ministry never blocked the payment for Ministry of Water and Power.

“I have approved release of Rs 10 billion today (Monday) to the power sector on the request of Minister of Water and Power Khwaja Asif,” he added.

Dar also negated reports that PSO had presented report to the Finance Ministry regarding petrol shortage before the crisis began. However, he admitted that there had been mismanagement in dealing with the crisis and added that Abbasi was leading an investigation to determine the officials responsible.

The minister said that action would be taken against those companies who did not keep adequate supplies of petrol. He said the oil marketing companies, including PSO, were responsible for maintaining a minimum stock and it was fault on their part that the people had to face difficulties.

IS IT THE INVISIBLE HAND THEN?

However, Petroleum Minister Abbasi surprised journalists by giving a clean chit to the Finance Ministry, retracting from his day-old statement in which he had blamed the ministry for lack of finances, which according to him had resulted in petrol shortage.

During a press conference after the meeting chaired by the prime minister, Abbasi gave a clean chit to all regarding the petrol crisis, stating that the “temporary petrol shortage” in Punjab was due to a “sudden” increase in demand for the petrol, following substantial reduction in its price and shut down of CNG stations.

In the same breath, Abbasi said that the prime minister had taken serious notice of the situation and an enquiry team had been formed to probe the issue.

“The inquiry team is headed by Prime Minister’s Advisor on Ministry of Petroleum Zahid Muzaffar and former Water and Power secretary Zafar Mehmood. The enquiry team will submit the findings of the probe before the prime minister on Tuesday and necessary action will be taken against the quarters responsible,” Abbasi added.

The minister said that during current month, the petrol demand increased by 30 per cent and the government was making all out efforts to arrange the additional fuel to meet the growing demand. He added that the government has started supplying 15,600 metric tonnes of petrol on a daily basis against an average daily demand of 12,000 metric tonnes of petrol a day.

“The government has decided to import 680,000 metric tonnes of petroleum products within the next two weeks,” he said, adding that the situation will normalise within two days.

The minister claimed that the government projected a total demand of petrol for the month of January at 380,000 metric tonnes, however the demand saw an unprecedented surge of over 450,000 metric tonnes.

“In order to deal with the shortage, the government is making arrangements for additional shipments, of which two ships carrying 52,000 metric tonnes and 15,000 metric tonnes of petrol have already reached and is being transported to the severely affected areas,” he added.

WHOSE FAULT IS IT ANYWAY?

In the meanwhile, a source in the Petroleum Ministry said that the petroleum shortage was due to the “ignorant attitude” of Water and Power Minister Khwaja Asif who did not bother to ensure that the circular debt of Rs 500 billion is cleared and the power companies pay the outstanding amount to PSO.

“PSO MD Amjad Pervez Janjua, sacked by PM along with petroleum secretary Abid Saeed, had thrice taken up the matter of pending dues with power companies with Ishaq Dar. He had also told the minister that if dues were not paid, a severe petrol crisis could trigger. He even wrote a letter to Finance Secretary Dr Waqar Masood on December 30, requesting that the Finance Ministry should take steps to ensure that Rs 198 billion liabilities of PSO against power sector be cleared by pressing the Water and Power Ministry. He had also requested that if it was not possible, Finance Ministry could release the amount, enabling PSO to purchase oil. However, Finance Ministry did not respond,” the source said.

The source said that the finance minister did not release the grant as requested by PSO MD which left PSO with no resources to purchase petroleum products. He said that Oil and Gas Regulatory Authority (OGRA) also failed to ensure payment to PSO by power companies. He suggested that action should also be taken against the regulator.

Another factor which added fuel to fire was that PARCO refinery had closed its operations for five days while the ship carrying fuel also arrived six days after its scheduled arrival.

Moreover, a PSO official said that it was interesting to note that the prime minister had sacked those PSO officials who had nothing to do with the matter. He said that Oil DG Azam Khan had been serving in the oil sector since the past three decades. He was inducted as assistant director.

The source said there was no logic for suspending petroleum secretary Abid Saeed, PSO MD Janjua and Natural Resources Additional Secretary Naeem Malik, who had time and again warned the finance minister of the looming crisis.

On the other hand, Petroleum Additional Secretary Arshad Mirza has been given charge of the federal secretary despite the fact that Mirza was “also responsible” for the mess.