Pakistan holds 392,000 metric tons of crude oil in stock; Senate panel told

ISLAMABAD, Mar 16 (APP):The Senate Standing Committee on Petroleum was informed on Monday that Pakistan currently holds around 392,000 metric tons of crude oil, with a daily consumption of about 36,000 metric tons.

The committee meeting was chaired by Senator Manzoor Ahmed in the absence of Chairman Umer Farooq. Officials briefed the panel that the country’s diesel reserves stand at approximately 404,000 metric tons, with a daily consumption of about 19,000 metric tons, while petrol reserves are around 564,000 metric tons, with a daily consumption of 20,600 metric tons.

During the briefing, the Petroleum Secretary informed the committee that several Gulf countries are currently experiencing disruptions in petroleum supplies due to the ongoing regional conflict.

He added that the availability of oil tankers has also become a challenge, as many ship owners are reluctant to operate under the prevailing security conditions.

The committee was told that Pakistan imports about 25 percent of its crude oil, 30 percent of diesel, and nearly 70 percent of petrol, mostly through the Persian Gulf via the Strait of Hormuz.

Regarding alternative arrangements, the Secretary said Pakistan has recently been allowed to purchase Russian oil after sanctions were temporarily eased for one month from March 11 due to the emerging global situation.

However, he pointed out that Pakistan currently lacks established banking channels for such transactions, and the procurement process may take 35 to 40 days.

He further explained that large Russian oil tankers cannot directly dock at Pakistani ports due to size limitations, requiring oil shipments to first reach Muscat or other ports in Oman before being transported onward to Pakistan.

The Secretary assured the committee that the government is making efforts to stretch existing petroleum stocks to prevent any immediate crisis.

He added that Prime Minister Shehbaz Sharif has constituted a high-level committee headed by Finance Minister Muhammad Aurangzeb to monitor the situation daily, while the Oil and Gas Regulatory Authority has also been directed to closely track petroleum stocks and prices.

The committee was informed that the ongoing threshing season has increased diesel demand across the country, and authorities are taking steps to ensure the uninterrupted supply of petroleum products.

During the meeting, Senator Manzoor Ahmed raised concerns over the recent increase in petroleum prices despite the availability of existing stocks.

He questioned whether the government could avoid imposing an additional financial burden on citizens and sought details about stock levels, taxes, and beneficiaries of the price hike before and after March 7.

Responding to the concerns, the Petroleum Secretary rejected claims that Oil Marketing Companies (OMCs) were benefiting from the price increase.

He said the adjustment was partly aimed at preventing panic buying and hoarding in the domestic market, noting that international diesel prices had surged from about $28 per barrel to nearly $88 per barrel due to the geopolitical situation.

Officials also briefed the committee on potential policy measures to manage fuel consumption, including facilitating two- and three-wheelers and possibly introducing an odd-even vehicle policy on roads if the situation worsens.

They added that global supply disruptions have already affected around 60 percent of India’s and 40 percent of China’s oil supply routes.

Senator Saadia Abbasi expressed concern over delays in finalizing arrangements for Russian oil imports, saying the recent Rs55 increase in petroleum prices had severely affected ordinary citizens.

The committee was further informed that Pakistan currently has two LNG supply arrangements with QatarEnergy, known as Qatar-I and Qatar-II, under which nine LNG cargoes are typically received each month.

However, the supplier has issued a force majeure notice due to the ongoing conflict, leading to reduced LNG shipments.

Officials said that while two LNG cargoes arrived at the start of March, six additional cargoes could not reach Pakistan due to the war conditions. At present, the country has LNG reserves sufficient only until mid-April.

The Secretary warned that LNG supply to the power sector may be curtailed from March 30, which could potentially lead to electricity load shedding in the country.