Pakistan: Energy supplies far from satisfactory

The incumbent government continues to say that Pakistan has ample supplies of petroleum products, the situation seems far from satisfactory. The fears are growing that if Pakistan and IMF fail in arriving at the consensus at the earliest supplies will dry in weeks.  

It may be recalled that on January 19, 2023 Petroleum Division wrote a letter to Governor, States Bank of Pakistan (SBP) to draw attention to the limited stocks of POL in the country and impending dry-out.

The SBP was asked for immediate establishment of 32 credit letters of refineries (PARCO and PRL) and oil marketing companies (PSO, GO, Hescol, BE, TAJ, PUMA, APL, EURO and Flow) to ensure import of crude oil and petroleum products.

The official said that when the country was not faced with the letters of credit crisis, 4-5 petrol cargoes were being imported, which was now down to 1.5 cargoes. However, three petrol cargoes of PSO, GO and Shell would soon arrive in the country.

PSO is importing a cargo of 50,000 metric tons, whereas cargoes of GO and Shell were smaller. However, it will be enough to avert the dry-out for the next fortnight,” the official informed.

It has been reported that State Minister for Petroleum Musadik Masood Khan will meet Governor SBP on Wednesday to discuss prioritized opening of credit letters to import petrol, an official of the Energy Ministry said.

The SBP governor would also be briefed about the current stocks of POL in the country by the petroleum minister.

Under the first priority list, DG oil recommends SBP to establish 23 letters of credit for the import of crude oil and petrol.

Under the second priority, 5 letters of credit need to be established for the import of high-speed diesel, whereas under the third priority list, 4 L/Cs for the import of lubricants had been recommended to the central bank.

According to the first prioritized list, PARCO needs the establishment of L/Cs for the import of two cargoes each having 535,000 barrels from ADNOC, one on January 13 and the other one on January 19. PRL also needs the opening of L/C for the import of 532,000 barrels of crude oil on January 30, 2023.

OMCs like PSO need the immediate establishment of L/Cs for the import of two cargoes, with each having 50,000 metric tons of petrol; one on January 17 and the other one on January 26. GO needs the opening of 6 L/sCs to import 6 petrol cargoes, BE needs 4 L/Cs to import petrol, TAJ and HPL need two L/Cs, whereas PUMA, APL and Flow need one L/C each to import their respective petrol cargoes.

The second priority list is for the import of HSD. OMCs such as TAJ need the opening of L/C to import 4,000 tons on February 4, 2023, while GO needs to establish 3 L/Cs for import of three cargoes having HSD on February 25-27.

Under the third priority list for the import of lubricants, PSO needs to establish L/Cs for import of three cargoes on March, 30, May 25, and May 20, and EURO is required to open L/C for one cargo of lubricants, which has already arrived.

Oil and Gas Regulatory Authority (OGRA) strongly refuted the claims on petrol/diesel shortages in the country on Tuesday.

OGRA Spokesman Imran Ghaznavi said, “The country has sufficient petrol and diesel stocks for meeting the demand for 18 and 37 days respectively. Furthermore, ships carrying 101,000 metric tons petrol are at berth/outer anchorage.”

Local refineries have been playing their due role in meeting the demand of petroleum products, the spokesman added.