Fuel shortage to persist as industry calls for pricing reform.

KARACHI -- The fuel shortage in the country is not likely to abate in the month of June, industry insiders tell Dawn, especially if sales remain elevated and pricing reform rem ains elusive.

All eyes in the industry are now on a crucial meeting scheduled to be held onMonday that will formulate the recommendation for reform of the oil pricing mechanism being used in the country.

The industry is unanimous in pointing to the pricing mechanism as a key enabler of manipulative behaviour in the oil marketing sector. `The long gapbetween one price adjustment and the next creates space for short-term manipulators to operate,` one senior industry source tells Dawn.

On Monday, a key subcommittee of the powerful Economic Coordination Committee is going to sit down and decide what to recommend to the government by way of oil pricing reform.The sub-committee consists of the special adviser to the PM on petroleum Nadeem Babar, Adviser on Government Reforms Dr Ishrat Hussain and Adviser on Commerce Razak Dawood.

They will decide whether or not to accept the industry`s recommendation ofmore frequent pricing decisions, to ensure less of a lag between international market price fluctuations and adjustments at the pump in the country.

At the moment, Pakistan has 208,000 metric tonnes of `usable stock` of motor gasoline, or mogas as industry professionals call it.

This is the ordinary petrol on which the commuting public drives its cars. The stock is sufhcient for eight days of consumption at present, elevated levels of consumption, estimated at 25,000 metric tonnes per day in the month of June by industry leaders. The normal consumption level is usually closer to 20,000 tonnes per day.

In diesel, the story is similar, except the position in KP is a lot tighter. The national stock is 313,000 metric tonnes, with average daily sales of 28,000 metric tonnes. At this level, the country has suf ficient diesel stock for 11 days.

`If current trends...