According to sources, the government has approached Saudi Arabia through diplomatic channels, asking it to extend the credit facility for oil supply from the existing 30 days to one year. The matter was taken up during the visit of Saudi Foreign Minister
At present, Saudi Arabia provides over 10,000 barrels of crude oil per day to Pakistan’s refineries. Annual crude import bill is around
Annual oil purchases from
“We have placed a request before the Kuwaiti government for extending the oil credit facility to six months and its response will be known after further negotiations,” a senior government official said.
In addition to the higher credit facility, the government is also planning to strike a state-to-state deal with Gulf countries to reduce the cost of crude oil imports. The import of oil and its products eats up roughly
In this connection, the
The country’s consumption of petroleum products stands at 22 million tons, of which about 13 million tons are imported. Apart from this, oil refineries import nine million tons of crude oil per annum to meet their processing needs.
Government officials believe that the import bill will swell further in the wake of closure of compressed natural gas (CNG) stations in Punjab and lack of gas supply for running power plants.
Demand for petrol from vehicle owners surges following shutdown of CNG outlets while absence of gas for power plants increases the need for furnace oil.
“In this scenario, we see pressure mounting on the already thin foreign exchange reserves of the country,” an official remarked.
Industry players say private companies in the oil sector have already made commercial arrangements with different oil suppliers. “And now, the government is planning to enter into relatively long-term oil import contracts with friendly Muslim countries,” an official said.
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