Fuel dealers withdraw protest as govt hikes loss compensation on fuel transport

KATHMANDU: Along with the decision of the government to increase the loss compensation to petroleum dealers on fuel transport, dealers have withdrawn their protest programmes.

Lilendra Pradhan, president of the Nepal Petroleum Dealers’ Association (NPDA), informed that dealers have resumed the collection and sales of petroleum products from today after the Nepal Oil Corporation (NOC) reviewed the loss compensation rate on fuel transport.

The meeting of the NOC board on Thursday night decided to hike the loss compensation to petroleum dealers on fuel transport to 45 litres for the supply of every 4,000 litres of petrol from NOC’s oil depots to fuel stations of dealers.

Similarly, the meeting also raised the loss compensation on diesel to 27 litres on every 4,000 litres of transport.

Prior to this, NOC had been allowing up to 24 litres compensation on diesel and 35 litres compensation on petrol to fuel dealers on every 4,000 litres of supply.

Citing that the government seemed reluctant to hike loss compensation despite its own report finding that dealers have been bearing ‘huge’ technical loss in fuel transport above the compensation rate allowed by NOC, NPDA had stopped collecting petrol from NOC from Thursday.

Moreover, dealers had also announced to completely halt collection and distribution of petroleum products across the country from Sunday. Subsequently a number of fuel stations remained shut on Thursday and today.

Though dealers have withdrawn their entire protest programme, fuel dealers said that the hiked rate does not actually match the actual amount of technical loss of fuel that they incur while transporting petroleum products to their fuel stations.

They also demanded that the government review the compensation rate in the future after conducting an extensive study on this issue.

Meanwhile, the NOC board also decided to form a special committee of the government to scientifically determine the actual amount of technical loss in fuel transport faced by petroleum dealers and resolve the issue completely within six months.

The Parliamentary Committee on Commerce, Industry and Consumer Welfare Relation on Thursday had directed dealers not to halt supply of petroleum products and had also asked the government to find a permanent solution to the matter at the earliest.