Govt scrambles for oil backup plans
Listen to article
Amid escalating tensions between Iran and Israel, the Oil and Gas Regulatory Authority (Ogra) has warned oil marketing companies (OMCs) to maintain a minimum of 20 days of oil stock in accordance with licensing requirements.
The prime minister has already constituted a high-level committee to explore alternative options in the wake of the Iran-Israel conflict to pre-empt any potential oil shortages in the country.
Oil Marketing Companies are obligated to maintain 20-day oil reserves under their licensing terms. Ogra has previously issued directives to this effect and has now reiterated its warning, stating that companies failing to comply will face penalties and fines.
In a statement, the Ogra spokesperson said, "The Oil and Gas Regulatory Authority (OGRA) has confirmed that the country currently holds sufficient stocks of petroleum products to meet existing demand".
However, in light of future needs and the volatile market environment, Ogra has formally advised all OMCs to adhere strictly to the mandatory 20-day stock levels, as stipulated in their respective licences.
"OGRA remains committed to monitoring the situation closely and will continue to take proactive steps to ensure national energy security," the spokesperson added.
In response to the evolving geopolitical situation following Israel's recent attack on Iran and the resulting fluctuations in global oil markets, Prime Minister Shehbaz Sharif constituted a high-level committee to oversee petroleum pricing and supply dynamics.
The committee is headed by the finance minister and includes senior representatives from key federal ministries, regulatory bodies and energy sector experts. It has already held its first meeting and is scheduled to reconvene early next week to assess possible supply routes and contingency measures.
During its initial meeting, the committee explored alternative oil supply routes from Saudi Arabia and the United Arab Emirates (UAE), including pipeline transport, in case the Strait of Hormuz – a critical global oil supply route – is blocked due to escalating hostilities.
The committee was informed that Saudi Arabia possesses an existing pipeline network, including the East-West Pipeline (Petroline), which transports crude from its eastern province to the Red Sea port of Yanbu.
Similarly, the UAE's Abu Dhabi Crude Oil Pipeline (Adcop) to Fujairah is designed to bypass the Strait of Hormuz, ensuring uninterrupted exports.
The Petroleum Division, in a submitted report, stated that the Strait of Hormuz handles 20% of global crude oil exports.
Any closure of this route by Iran could severely impact global supply chains, including Pakistan's. Under a worst-case scenario, global oil prices could surge to $100$150 per barrel.
While there is currently no immediate threat of a spike in prices, Pakistan is in discussions with international oil suppliers to ensure continuity of supply.
At present, the country has access to up to one million tons of furnace oil storage capacity through abandoned power plants.
Experts have recommended that the government utilise these facilities to store strategic oil reserves. It has also been proposed that the government purchase these storages, as the power sector plans to dispose of them as scrap.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Recorder
3 hours ago
- Business Recorder
Yemeni Houthi's response to US attack on Iran ‘only a matter of time', official says
CAIRO: A Yemeni Houthi official said on Sunday that the Iran-aligned group's response to the US attack on Iran was 'only a matter of time'. Mohammed al-Bukhaiti, a member of the Houthi movement's political bureau, told Al Jazeera Mubasher TV that its ceasefire deal with Washington was before the 'war' on Iran. The group has been launching attacks on shipping lanes and Israel in what it says is in solidarity with Palestinians in Gaza during the Israeli war. Trump says US forces bombed Iran nuclear sites; says 'Fordow is gone' It agreed on a ceasefire deal with the United States in May to stop attacking US ships in exchange for an end to Washington's bombings of the group.
Express Tribune
5 hours ago
- Express Tribune
Israeli fire kills 8 near aid centres
Palestinians at al-Shifa Hospital react over the bodies of their relatives killed by Israeli fire near an aid distribution centre in central Gaza, June 11 [Dawoud Abu Alkas/Reuters] Gaza's civil defence agency said Israeli fire killed at least 12 people on Saturday, including eight who had gathered near aid distribution sites in the Palestinian territory suffering severe food shortages. Civil defence spokesman Mahmud Bassal told AFP that three people were killed by gunfire from Israeli forces while waiting to collect aid in the southern Gaza Strip. In a separate incident, Bassal said five people were killed in a central area known as the Netzarim corridor, where thousands of Palestinians have gathered daily in the hope of receiving food rations. The Israeli army told AFP it was "looking into" both incidents, which according to the civil defence agency occurred near distribution centres run by the US- and Israel-backed Gaza Humanitarian Foundation. Its operations began at the end of May -- when Israel eased a total aid blockade that lasted more than two months -- but have been marred by chaotic scenes and neutrality concerns. UN agencies and major aid groups have refused to cooperate with the foundation over concerns it was designed to cater to Israeli military objectives. The health ministry in the Hamas-run territory said on Saturday that 450 people had been killed and 3,466 others injured while seeking aid in near-daily incidents since late May. The Israeli blockade imposed in early March amid an impasse in truce negotiations had produced famine-like conditions across Gaza, according to rights groups. Israel's military has pressed its operations across Gaza more than 20 months since an unprecedented Hamas attack triggered the devastating war, and even as attention has shifted to the war with Iran since June 13. Bassal told AFP that three people were killed on Saturday in an Israeli air strike on Gaza City in the north, and one more in another strike on the southern city of Khan Yunis. Israeli forces also demolished more than 10 houses in Gaza City "by detonating them with explosives", he added. Israeli restrictions on media in the Gaza Strip and difficulties in accessing some areas mean AFP is unable to independently verify the tolls and details provided by rescuers and authorities. Earlier this week, the UN's World Health Organization warned that Gaza's health system was at a "breaking point", pleading for fuel to be allowed into the territory to keep its remaining hospitals running.
Express Tribune
5 hours ago
- Express Tribune
Govt scrambles for oil backup plans
Listen to article Amid escalating tensions between Iran and Israel, the Oil and Gas Regulatory Authority (Ogra) has warned oil marketing companies (OMCs) to maintain a minimum of 20 days of oil stock in accordance with licensing requirements. The prime minister has already constituted a high-level committee to explore alternative options in the wake of the Iran-Israel conflict to pre-empt any potential oil shortages in the country. Oil Marketing Companies are obligated to maintain 20-day oil reserves under their licensing terms. Ogra has previously issued directives to this effect and has now reiterated its warning, stating that companies failing to comply will face penalties and fines. In a statement, the Ogra spokesperson said, "The Oil and Gas Regulatory Authority (OGRA) has confirmed that the country currently holds sufficient stocks of petroleum products to meet existing demand". However, in light of future needs and the volatile market environment, Ogra has formally advised all OMCs to adhere strictly to the mandatory 20-day stock levels, as stipulated in their respective licences. "OGRA remains committed to monitoring the situation closely and will continue to take proactive steps to ensure national energy security," the spokesperson added. In response to the evolving geopolitical situation following Israel's recent attack on Iran and the resulting fluctuations in global oil markets, Prime Minister Shehbaz Sharif constituted a high-level committee to oversee petroleum pricing and supply dynamics. The committee is headed by the finance minister and includes senior representatives from key federal ministries, regulatory bodies and energy sector experts. It has already held its first meeting and is scheduled to reconvene early next week to assess possible supply routes and contingency measures. During its initial meeting, the committee explored alternative oil supply routes from Saudi Arabia and the United Arab Emirates (UAE), including pipeline transport, in case the Strait of Hormuz – a critical global oil supply route – is blocked due to escalating hostilities. The committee was informed that Saudi Arabia possesses an existing pipeline network, including the East-West Pipeline (Petroline), which transports crude from its eastern province to the Red Sea port of Yanbu. Similarly, the UAE's Abu Dhabi Crude Oil Pipeline (Adcop) to Fujairah is designed to bypass the Strait of Hormuz, ensuring uninterrupted exports. The Petroleum Division, in a submitted report, stated that the Strait of Hormuz handles 20% of global crude oil exports. Any closure of this route by Iran could severely impact global supply chains, including Pakistan's. Under a worst-case scenario, global oil prices could surge to $100$150 per barrel. While there is currently no immediate threat of a spike in prices, Pakistan is in discussions with international oil suppliers to ensure continuity of supply. At present, the country has access to up to one million tons of furnace oil storage capacity through abandoned power plants. Experts have recommended that the government utilise these facilities to store strategic oil reserves. It has also been proposed that the government purchase these storages, as the power sector plans to dispose of them as scrap.
