KARACHI: Refineries warned of looming petrol crisis by mid-February if government fails to resolve payments issues of imported raw materials and additives needed by sector.

Delay in payments of raw materials and additives as well as dollar shortage hampered production of petrol massively, refineries explained.

“Situation will become extremely critical mid-February 2023, if remedial measures are not taken immediately,” local refineries warned State Minister for Petroleum Dr Musadik Malik and Governor State Bank of Pakistan Dr Jameel Ahmed in separate letters. Letters were jointly written by Pakistan Refinery Limited, National Refinery, Attock Refinery and Cnergyico Refinery.

Difficulties in establishing letters of credit for payment of raw materials and other inputs needed by refineries have been cited as major cause of looming crisis. Punjab has already started experiencing unavailability of petrol, after alleged hoarding in anticipation of price hike expected in next fortnightly review.

Refineries noted that maximum production of indigenous petroleum products especially mogas at this critical time was need of hour, as oil marketing companies (OMCs) were already finding it difficult to import fuel due to foreign exchange liquidity crunch.

Refineries asked central bank to advice banks to release/establish credit letters for refineries and remittances against already issued letters without further delay to avoid any unpleasant situation.

PPDA urges probe into shortage

Pakistan Petroleum Dealers Association has asked Ministry of Petroleum and Natural Resources to immediately formulate committee to find out reasons behind this shortage.  Office bearers of PPDA said that drafts of around Rs 1 billion have been stuck with oil companies and these 12,000 dealers were not getting supplies from OMCs.

Published in The Daily National Courier, February, 11 2023

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