PM Shehbaz directs improvement of petroleum supply chain amid Middle East crisis

Prime Minister Shehbaz Sharif on Tuesday directed the petroleum minister to further enhance the supply chain for petroleum imports and instructed all relevant institutions to remain prepared to take emergency measures until the regional situation improves. 

According to Prime Minister Office, the directives were issued during a meeting chaired by the prime minister to review the implementation of fuel conservation and austerity measures in light of the evolving regional situation.

During the meeting, officials briefed the prime minister on the progress made in implementing austerity and energy-saving steps announced earlier by the government.

it was informed that the prime minister’s directives regarding conservation measures were being implemented and that the Intelligence Bureau would present monitoring reports on the enforcement of these steps.

The meeting was also told that Pakistan currently has adequate reserves of petroleum products to meet national requirements.

Officials said the government is closely monitoring the overall situation and maintaining a detailed record of petroleum products to ensure that any irregularities can be identified immediately.

The meeting was further informed that cabinet members have voluntarily foregone their salaries, while reductions in fuel consumption by government departments have begun to yield positive results. These austerity measures, officials said, will help provide relief to the public under the current circumstances.

The briefing also noted that the country holds adequate stocks of medicines to meet domestic needs.

In addition, arrangements have been completed by the Ministry of Information Technology and Telecommunication to provide special connectivity for the government’s e-office system to facilitate work-from-home operations if required.

Read: Pakistan has oil reserves for days, not months

Pakistan currently has crude oil reserves sufficient for 11 days, diesel for 21 days, petrol for 27 days, LPG for nine days, and jet fuel (JP-1) for 14 days, the secretary of petroleum informed the Senate Standing Committee on Petroleum on Monday.

The petroleum secretary also warned that Pakistan could face a severe gas shortage after April 14 due to disrupted LNG cargo supplies. Meanwhile, the government decided to provide a Rs23 billion subsidy for motorcycle and rickshaw owners using savings generated under its austerity policy.

The government has decided to conduct a daily review of petroleum reserves to closely monitor the energy situation.

A committee tasked with monitoring petrol prices was informed that Pakistan remained "adequately positioned in terms of fuel availability", with March requirements fully secured and supply coverage available up to mid-April under current cargo planning.

According to a statement issued by the Ministry of Finance, the committee reviewed the national inventory of crude oil and refined petroleum products, import arrangements, and supply chain logistics.

Officials told the meeting that the country had "comfortable inventories of crude oil and key petroleum products for March, with sufficient planning in place to ensure continued availability during April". Efforts are also underway to extend coverage towards the end of April.

On March 6, the government sharply increased diesel and petrol prices by Rs55 per litre or 20% — marking the first increase in a series of similar surges in the coming days due to the ongoing US-Israel and Iran war, which has disrupted supply chains and pushed crude oil prices to two years’ highest level.

Read more: PM Shehbaz says petroleum prices to remain unchanged despite increase in int'l market

The increase in petrol prices was more than the surge in the international market, as the government chose to collect more money than required from motorcyclists and car owners to subsidise the use of diesel, mostly by the public transport and the agriculture sector.

Petroleum Minister Ali Pervaiz Malik announced the new rates with immediate effect after PM Shehbaz decided to increase the petroleum products prices on a weekly basis.

The new price of high-speed diesel will be Rs336 per litre and petrol Rs321 per litre, said Malik in a pre-recorded speech. He was accompanied by Deputy Prime Minister Ishaq Dar and Finance Minister Muhammad Aurangzeb.

The government also increased the petroleum levy on petrol to a record Rs105.4 per litre but reduced it to Rs55 per litre on diesel.