Petroleum crisis looms as prices soar globally

As the country grapples with the onslaught of rising petroleum prices, policymakers are scrambling to find a way to combat the growing crisis and secure the nation’s energy future.

Globally, petroleum prices continue to surge, which have had a significant impact on the Pakistani market. Currently, 90% of petroleum products in the country are imported, with a mere 10% of production taking place domestically.

The shortage of petroleum reserves in Pakistan also remains a cause for concern.

In 2014, the country had 387.49 barrels of crude oil reserves, which dwindled down to a mere 92.91 barrels in 2023. This drop is further exacerbated by the decline in oil wells, with the number decreasing from 100 in 2014 to a paltry 47 today, the insiders revealed.

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Sources revealed that the stark reality is that Pakistan has a demand of over 26 million metric tons of petroleum products, while it can only produce 1400 million metric tons.

This growing gap between demand and production is a ticking time bomb that needs immediate attention.

The situation is aggravated by the departure of international petroleum companies from Pakistan. Since 2010, a staggering 11 companies have closed their operations in the country, leaving a void that needs to be filled urgently.

Experts believe that the return of these international players is crucial for the country's economic growth and to reduce the overall rate of inflation.

Comparatively, a silver lining in the crisis is that Pakistan's petroleum prices are lower than those of its neighbouring countries. However, this advantage is nullified by the increasing dependence on costly imports.

Insiders suggest that one possible solution to alleviate the country's petroleum woes is to improve the railway and public transport systems, as well as introduce electric vehicles.