Let me address the second issue first. In the recent past
government asked power plants not to use furnace oil. The limited offtake of
furnace oil forced the refineries to operate at lower capacity utilization. The
decision has no rationale because running of refineries at lower capacity utilization,
reduced output of petrol as well as diesel.
The worst has been the decision of the government to stop or
delay opening of L/Cs. Though, the government as well as State Bank of Pakistan
keeps on denying delay in the opening L/Cs, it emerged to be the harsh reality.
To be prudent, the government must allow: 1) opening of L/Cs
for the import of crude oil – available on deferred payment from Saudi Arabia
and 2) ensuring operating refineries at optimum capacity utilization.
Lately, PARCO has solicited order for the export of furnace
oil, despite the impression that Pakistani refineries are not competitive in
the global markets.
Sector experts are of the opinion that the government should
immediately allow running of power plants on furnace oil.
Enhanced offtake of furnace oil will allow operating of
refineries at optimum capacity utilization and achieve greater synergy and
reduction in the cost of production.
