‘Hike in oil prices essential’

Biratnagar, August 1:

Petroleum Entrepreneurs of Eastern Region (PEER) feel that Nepal Oil Corporation (NOC) is on the verge of collapsing and it is absolutely essential to raise the price of petroleum products in order to save it. Entrepreneurs have put this demand in the third general meeting of Eastern Regional Petroleum Suppliers Association. Association’s chief, Shiva Prasad Ghimire wondered, “How can the oil corporation run at such a loss? Price hike is essential.”

Advisor of the association and petroleum entrepreneur Devaki Nandan Agrawal said that even though the price hike will affect customers, it is essential for the survival of the corporation and added that the corporation must consider it. Secretary of Sagarmatha Petroleum Dealers Association, Balaram Das said that prices must be raised but without affecting the public much. Eastern regional directorate of NOC informed that a loss of Rs 1.22 billion is being incurred in the eastern region alone every year by NOC.

The directorate informed that there is loss of Rs 11.50 on the sale of per litre of diesel and Rs 9.50 on per litre of kerosene. Chief of the regional office, Arjun Prasad Singh said to this daily, “We suffer a loss of Rs 770 million in Diesel and Rs 450 million on Kerosene annually in this region.” Chief Singh said that the demand of the entrepreneurs is justified keeping in mind the present situation of the corporation. Currently the market price of kerosene is Rs 34 per litre and of diesel Rs 41 per litre. According to the statistics, 70,000 kilolitres of diesel and 50,000 kilolitres of kerosene are required in the eastern region yearly.

But the supply of these petroleum products is not adequate due to the increasing loss in NOC.

Similarly, entrepreneurs have also demanded purchasing petroleum products through the Siliguri terminal of India, as it is most convenient for the eastern region. The Siliguri terminal lies at a distance of 160 km from the eastern depot of the corporation. NOC had stopped the import of petroleum products through Siliguri terminal a year back due to some controversy regarding local tax and VAT. But entrepreneurs feel the terminal is most convenient for the import of petroleum products. Presently, the corporation imports petroleum from Assam and Bihar. Shiva Kumar Ghimire informed that Assam and Bihar lie at a distance of 400 km and 300 km respectively, which makes the delivery charge expensive. This is further hurting the corporation.The corporation offers suppliers Rs 1.88 per km as delivery fee, presently.