Islamabad [Pakistan], December 11 (ANI): Pakistan’s oil sector is on the brink of collapse after years of regulatory lapses and government inaction have left key operational, fiscal and structural problems unaddressed.
The Oil Companies Advisory Council (OCAC) has again raised alarms, urging the Oil and Gas Regulatory Authority (Ogra) to act on issues ranging from unrecovered sales tax and exchange-rate losses to port shortcomings and a hurried retail digitisation roll-out, The Express Tribune reported.
OCAC Secretary General Syed Nazir A Zaidi wrote to the Ogra chairman, with a copy to the petroleum minister, detailing the industry’s dire condition. Despite repeated meetings involving the Petroleum Division, Ogra and oil marketing companies (OMCs), progress has been minimal.
The council said GST refunds of about PKR 73 billion have been stuck with the Federal Board of Revenue (FBR) since April 2022, severely hurting liquidity. OCAC asked for a clear reimbursement mechanism that includes financing costs calculated at Kibor plus 2%.
OCAC also condemned the current exchange-loss recovery process as “non-transparent” and “unequal,” saying the lack of a standard, timely adjustment formula from Ogra has left many companies uncompensated amid currency volatility. The petroleum minister had instructed Ogra to resolve these claims, but the regulator has not yet produced concrete results.
The council warned that phase-3 digitisation of retail outlets has been rushed, with short implementation timelines and no cost-recovery measures, creating operational strain. It also flagged worsening port infrastructure at Fotco — limited night navigation and inadequate pipeline facilities — causing costly demurrage charges.
OCAC urged Ogra to coordinate with port authorities and stakeholders to devise practical, transparent solutions. Without swift action, Pakistan’s oil supply chain risks severe, prolonged disruption that could deepen the country’s energy crisis, The Express Tribune reported. (ANI)
(This content is sourced from a syndicated feed and is published as received. The Tribune assumes no responsibility or liability for its accuracy, completeness, or content.)
