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Country Report Pakistan Product Image

Country Report Pakistan

  • ID: 2101420
  • January 2015
  • Region: Pakistan
  • 25 Pages
  • The Economist Intelligence Unit

The prime minister, Nawaz Sharif, cancelled all his official engagements on January 19th to concentrate on managing the fuel crisis that had emerged in Punjab province the previous week and subsequently spread to Khyber-Pakhtunkhwa province and the commercial capital, Karachi, in Sindh province.

Pakistan's predicament is due to several internal problems that compromise its ability to take advantage of falling international oil prices. The failure of the Oil and Gas Regulatory Authority (OGRA) to track the fall in oil reserves accurately, refinery breakdowns and delays in shipping imports have all contributed to the crisis. However, the main cause of the fuel shortage is the huge circular (inter-corporate) debt burden crippling the entire energy sector. The main oil marketing and distribution company, Pakistan State Oil (PSO), which imports 80% of Pakistan's petroleum products, borrowed heavily throughout 2014 to finance oil purchases even as it was unable to collect receivables from private electricity generation companies, which in turn are owed money by power distribution companies. PSO's debts to banks now stand at PRs284bn (US$2.8bn), against PRs222bn of money owed to it. READ MORE >

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Country Report Pakistan

Oil crisis erupts despite falling global prices
Impact on the forecast

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Note: Product cover images may vary from those shown


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