Refineries in Danger Due to Surplus Fuel Stocks and Poor Import Policies

The oil industry has strongly protested to the Oil and Gas Regulatory Authority (OGRA) over a surge in oil stocks, which has been driven by increased imports and smuggled petroleum products.

The Oil Companies Advisory Council (OCAC) had raised these concerns with OGRA who then scheduled a meeting for Tuesday. However, the meeting was abruptly postponed. The industry has warned that the current situation could lead to the collapse of local oil refineries.

Pakistan currently holds 461,000 metric tons of fuel oil, enough for 301 days, and 445,146 metric tons of petrol, sufficient for 21 days. Despite these reserves, there is a noted lack of domestic demand, with 90 percent of furnace oil being exported. There are 771,000 metric tons of high-speed diesel (HSD), enough to meet demand through September.

OCAC has criticized OGRA’s ongoing approval of HSD imports by a specific oil marketing company, despite local refineries having sufficient stocks. The council highlighted that these imports violate the Pakistan Oil Rules 2016, which require prioritizing local production.

The association also raised concerns about the alleged unfair business environment and called on OGRA to enforce fair practice to ensure the stability of the oil sector.