ISLAMABAD: Local refineries in Pakistan have urged the government to temporarily suspend the import of petrol and diesel until March, citing operational challenges as oil marketing companies have significantly reduced their purchases of domestically produced petroleum products.
In a letter to the Oil and Gas Regulatory Authority (OGRA), the refineries highlighted a 20% decline in petrol sales and a 31% drop in diesel sales. The letter also noted that the country currently has sufficient stocks, with 36 days’ worth of petrol and 39 days’ worth of diesel available, underscoring the need to halt imports temporarily.
The refineries attributed part of their struggles to reduced diesel consumption caused by a lack of rainfall, further exacerbating their difficulties.
In January, the oil industry raised concerns about being excluded from a government working group tasked with developing a roadmap for deregulating the downstream oil sector.
Last year, the Special Investment Facilitation Council extended the deadline for signing agreements on investments worth approximately $6 billion in the refining sector and announced measures to curb the smuggling of petroleum products.
The refineries also criticized the federal budget for 2024-25, claiming it nullified the Brownfield Refining Policy, which was designed to encourage the establishment of new refineries and the modernization of existing ones. They called for the restoration of the previous tax framework, which included customs duties on diesel and standardized sales tax policies for all petroleum products.
