ISLAMABAD: Warning of a potential shortage of petroleum products, the country’s oil industry has urged the government to immediately release outstanding Price Differential Claims (PDC) amounting to Rs66.7 billion to ensure uninterrupted supply of POL products.
The industry has cautioned that it no longer has the financial capacity to absorb unilateral changes to the pricing formula or any further increase in working capital requirements while simultaneously financing higher-cost imports.
In a letter addressed to Minister for Petroleum and Natural Resources, Ali Pervaiz Malik, Chairman of the Oil Companies Advisory Council (OCAC), Asif Iqbal, highlighted the increasingly fragile Motor Spirit (MS) supply situation, warning that failure to act could lead to localised shortages across the country in the coming days.
According to the letter, the current supply position is extremely tight, with around 370,000 tonnes of MS stocks — equivalent to approximately 15 days of cover — available nationwide. However, a portion of this stock, including volumes from the last imported cargo, remains unavailable for sale due to bottlenecks in the customs clearance process, effectively reducing immediately saleable inventory.
The OCAC noted that three MS import cargoes are scheduled to arrive between July 15 and July 17, including one cargo vessel, MT Bolan, which berthed at FOTCO on Wednesday. These cargoes are critical for maintaining uninterrupted supplies. However, delays in the WEBOC customs clearance system could hinder the timely release of imported products, particularly affecting upcountry markets.
“Under the prevailing circumstances, any further delays in customs clearance could materially impact product availability and increase the likelihood of localised shortages, especially in upcountry locations,” the letter warned.
The situation has been further aggravated after one planned MS import cargo of Pakistan State Oil (PSO) was not approved by the National Coordination and Management Council (NCMC) in June 2026, disrupting expected inventory replenishment.
The industry is also witnessing increased market activity amid reports of a likely rise in international petroleum prices. Such expectations typically trigger accelerated upliftment and higher consumer demand, placing additional strain on already constrained inventories.
The OCAC emphasised that the crisis is being compounded by severe liquidity constraints faced by Oil Marketing Companies (OMCs) due to the continued non-payment of Rs66.7 billion in pending PDC claims. The prolonged delay in disbursement has significantly impaired the industry’s ability to finance imports and maintain adequate stock levels.
“With international petroleum prices expected to rise, working capital requirements will increase substantially. The continued non-payment of PDC claims, combined with higher import costs, is placing an unsustainable financial burden on OMCs,” the OCAC stated.
The industry maintained that without immediate financial relief, several companies may face difficulties in procuring timely import cargoes, thereby worsening supply risks. While supporting consumer relief measures, the OCAC stressed that any such initiatives should be funded by the government rather than imposed on the industry.
In light of the situation, the OCAC has sought the Petroleum Minister’s urgent intervention to: (i) facilitate immediate release of the outstanding Rs66.7 billion in PDC claims; (ii) direct relevant authorities to expedite customs clearance of imported petroleum products by removing WEBOC bottlenecks; and (iii) ensure full government support for uninterrupted import and distribution of petroleum products nationwide.
Given the tight supply position, anticipated surge in demand, and mounting financial constraints, the industry warned that immediate intervention is essential to avert disruptions and ensure continuous availability of Motor Spirit across the country.
Copyright Business Recorder, 2026
Comments