KARACHI: Pakistan plans to fully deregulate its petroleum product market in 2027 after the country’s oil refineries make necessary technical upgradations in 2026, according to the draft of the upcoming Pakistan Oil Refining Policy, 2021, seen by Arab News.
Earlier this month, the Cabinet Committee on Energy had given the policy its approval in principle, though it was still required to go through various phases before its final endorsement.
Petroleum product rates in Pakistan are currently determined by the government that periodically revisits them to keep them consistent with the price fluctuations in the international market.
“The target date for full deregulation is December 31, 2027,” the document says. “The mechanism for deregulation will be finalized in consultation with all the stakeholders.”
“The objectives of this policy include a shift to complete deregulation on pricing within a defined time period to be reviewed by the Government of Pakistan to allow the benefit of competitive forces to pass on to the consumers,” the draft adds.
Pakistan plans to offer various incentives, including a 10-year income tax holiday, to oil refineries in the country that are willing to upgrade their hardware to produce fuel with Euro-V specifications.
The Euro-V standards require a cutdown in the sulfur content to avoid air pollution and improve vehicle efficiency which is mostly affected by low quality fuels.
At present, there are five oil refineries in Pakistan with can reach a maximum collective output of 450,000 barrels per day. If these oil refineries work at their optimal capacity, they can yield up to 20 million tons of oil per annum.
The government has also decided to announce tariff protection for six years for the refineries that choose to upgrade. According to petroleum experts, the minimum financing for the upgradation of hardware would roughly be around $4-5 billion.
“Roughly, the refineries will need four to five billion dollars in the next five years to upgrade and produce fuel with Euro-V specifications,” Dr. Nazar Abbas Zaidi, former secretary of the Oil Companies Advisory Council, said.
He added the existing refineries had sought the government support which was likely to be offered through various incentives under the new policy.
“The upgradation of refineries is vital to ensure the country’s energy security,” Zaidi continued.
According to the draft policy, the Pakistani oil refineries are required to complete the upgradation process by December 31, 2026.
The document further says the deregulation will allow oil marketing companies (OMCs) to set the prices themselves, based on the quality of fuel, the location and other value-added services.
“Under the deregulated petroleum market, the role of the government will be minimized and market forces will determine the price of different kinds of fuels on the basis of their demand and supply,” Samiullah Tariq, director research at the Pakistan-Kuwait Investment, said.
“The deregulated environment will promote competition among the refineries and consumers will have the option to choose the best product at competitive rates,” he said.
Tariq maintained the regulated regime was one of the key factors that discouraged the upgradation of the country’s existing oil refineries.
According to the proposed policy, the deregulation model is already functional in the country for Hi Octane Ron 97.
“However, even in this [deregulated] environment, the product pricing at the pumps operating under the banner of Pakistan State Oil shall set a market benchmark, since PSO has the largest footprint across the country and is majority owned by the government,” it says.
Other OMCs may charge more or less than the PSO, depending on their level of service, convenience of location and quality of products.
“The actual spirit of deregulation will be witnessed after the government abolishes the inland freight equalization margin,” Aftab Hussain, former chief executive officer of Pakistan Refinery, told Arab News. “This implies that the fuel may become two rupees cheaper in Karachi or two rupees costlier in Peshawar.”
“If the government wants to deregulate on the basis of ex-refinery rates in 2027, it can do it now because furnace oil and jet fuel are already deregulated products,” he said, adding that there were several things in the proposed policy that needed clarification.
Petroleum expert said there would be multiple benefits of the upgradation of oil refineries and deregulation of petroleum products.
“The major benefit of the deregulated market environment will be a uniform standard of petroleum products in our country,” Zaidi said. “At present, high sulfur content in fuel is causing health issues that need to be addressed.”
A Texas-based energy expert, Masood Abdali, said the upgradation of Pakistan’s oil refineries will also cut the country’s import bill.
“Presently, a substantial quantity of crude that is being exported due to a lack of refining capabilities will also be processed in the country which will cut down the import bill,” he said.
Pakistan has exported 49,272 metric tons of crude worth $28.3 million during the current fiscal year, up by 88 percent as compared to the corresponding period last year.
Pakistan sets 2027 deadline to fully deregulate petroleum sector
https://arab.news/5jvmp
Pakistan sets 2027 deadline to fully deregulate petroleum sector
- The government plans to offer incentives to the country’s oil refineries to upgrade and produce fuel with Euro-V specifications
- The draft of the Oil Refining Policy, 2021, says the deregulation mechanism will be finalized in consultation with all stakeholders
Pakistan stock market registers second highest single-day gain on ‘easing political noise’
- The benchmark KSE-100 index surged by 4,411 points, or 4.3 percent, to close at 113,924 points on Monday, according to stock traders
- The development came as Pakistan’s government holds talks with ex-PM Imran Khan’s PTI opposition party to address political polarization
ISLAMABAD: The Pakistan Stock Exchange (PSX) began the week on a strong note and gained more than 4,000 points on Monday, stock analysts said, attributing the rally to “easing political noise” and upbeat economic indicators.
The benchmark KSE-100 index surged by 4,411 points, or 4.3 percent, to close at 113,924 points on Monday, according to stock traders. The market saw the trading of 424,809,788 shares and registered the second highest single-day gain from Friday’s close of 109,513 points.
Stock analysts said upbeat economic indicators on surging exports, remittances and foreign exchange reserves as well as the government’s talks with the opposition Pakistani Tehreek-e-Insaf (PTI) party played a catalyst role in the rally.
“Stocks’ bullish record led by scrips across the board as investor weigh falling lending rates after fall in government bond yield and easing political noise,” Ahsan Mehanti, chief executive officer of Arif Habib Commodities, told Arab News.
Mehanti’s comments came hours after the Pakistani government held a first round of talks with jailed former prime minister Imran Khan’s PTI party to address political polarization in the country.
Pakistan has remained gripped by political unrest and uncertainty since Khan’s ouster from power through a parliamentary no-confidence vote in April 2022, which has also exacerbated Pakistan’s economic hardships.
However, Pakistan’s economic indicators have improved and the stock market has surged significantly, reaching a historic high of 117,039 points this month. Though the market shed around 9,000 points last week, but it recovered on Friday by registering a sharp increase of more than 3,000 points.
Pakistan’s central bank this month cut its key interest rate by 200 basis points to 13 percent, marking the fifth straight reduction since June. The country’s annual consumer inflation also slowed to 4.9 percent in November, lower than the government’s forecast and the lowest in nearly six years. This was down from 38 percent last year.
Data released by the Pakistan Bureau of Statistics also supports positive investor sentiment as the trade deficit narrowed by 7.39 percent during the first five months (July-November) of the current fiscal year, standing at $8.651 billion, compared to $9.341 billion during the same period last year.
Exports rose by 12.57 percent to hit $13.69 billion, while imports increased by 3.90 percent to $22.342 billion during this period. November’s trade deficit narrowed even further, dropping by 18.60 percent year-on-year to $1.589 billion compared to $1.952 billion in November 2023.
Pakistan recorded an increase of 29.1 percent year on year in workers remittances, which amounted to $2.9 billion in November, according to the central bank data. The inflows rose by 33.6 percent to $14.8 billion from July till November, compared to $11.1 billion received during the same period last year.
PM hails Pakistan for ‘unstoppable, unbeatable’ performance in South Africa ODI series
- Green Shirts thrashed South Africa 3-0 after losing Twenty20 series 2-0
- Pakistan will now play three Tests against South Africa later this month
ISLAMABAD: Prime Minister Shehbaz Sharif on Monday praised the Pakistan cricket team for winning a three-match One Day International (ODI) series against South Africa, describing their performance as “unstoppable and unbeatable.”
The Green Shirts completed a series clean sweep over South Africa in the third ODI at the Wanderers Stadium on Sunday, with rising star Saim Ayub smashing his second century of the series and his third from five innings.
The left-handed opening batsman made a sparkling 101 off 94 balls in a Pakistan total of 308 for nine. Heinrich Klaasen thrashed 81 off 43 balls for South Africa, but the hosts were beaten by 36 runs chasing an adjusted target of 308 because of rain.
“Unstoppable and unbeatable!” Sharif remarked in a post on X. “Congratulations to Team Pakistan on an outstanding 3-0 ODI series victory against South Africa.”
The prime minister also praised the Pakistan Cricket Board chairman for the team’s performance.
“Well done, boys! Your determination, skill, and teamwork under the leadership of the PCB Chairman Syed Mohsin Raza Naqvi have made the entire nation proud,” he said.
“Keep raising the green flag high!“
South Africa won the T20I series 2-0 after the third match was washed out on Dec. 14. The ODI series win comes ahead of the upcoming International Cricket Council (ICC) Champions Trophy, which Pakistan will hosting in February and March 2025.
Pakistan will also play three Tests against South Africa later this month.
Government, Imran Khan’s party conclude first round of formal talks, next session on Jan. 2
- Negotiations began after Khan threatened civil disobedience, seeking release of political prisoners
- PTI has been asked to present its demands in the next session to set the tone for the negotiations
ISLAMABAD: The government and the opposition Pakistan Tehreek-e-Insaf (PTI) of former Prime Minister Imran Khan held the first round of formal negotiations on Monday to address a range of issues, with PTI asked to present its demands in writing at the next session on January 2.
The two sides began long-awaited talks to resolve issues fueling political polarization and straining the country’s fragile economy, with National Assembly Speaker Ayaz Sadiq chairing the meeting, after the government formed a negotiating team a day earlier.
The development came after ex-premier Khan’s threat to launch civil disobedience by urging overseas Pakistanis, his party’s key support base, to halt remittances if his demands, including the release of political prisoners, were not met by Dec. 22. Khan, who has been imprisoned for over a year on charges he claims are politically motivated, has also called for judicial commissions to investigate violent protests on May 9 last year and Nov. 26 this year, which the government says involved his party supporters.
Known for taking hard-line political positions, Khan formed a seven-member committee to negotiate with the government. This was done amid growing concerns he may face trial by the military for allegedly inciting attacks on sensitive security installations during violent protests following his brief detention last year in a graft case.
“Since some members of the opposition could not join the talks today, we have decided to hold the next meeting on January 2,” Sadiq said at the end of the initial round of negotiations. “The opposition will also present a charter of demands in the meeting.”
He said the talks were held in a cordial environment, adding that it was vital to end political polarization in parliament and across the country.
The speaker requested Senator Irfan Siddiqui to read a joint press statement and urged people not to speculate excessively about the negotiations to ensure their success.
Siddiqui said both sides agreed parliament was the appropriate forum to resolve political differences and emphasized that the negotiation process should continue.
He mentioned the PTI had been asked to provide a written document outlining its demands to help set the tone for the talks.
Speaking to the media later, Khan’s close aide, Asad Qaiser, said the PTI team asked the government to release all political prisoners, including the former prime minister, and form a judicial commission with senior Supreme Court judges to probe the May 9 and Nov. 26 incidents.
“We should be allowed to hold a meeting with Imran Khan,” he said. “He is our leader. We will move forward with his instructions.”
Qaiser informed the government had said it would arrange the meeting, though he maintained it was not clear when would that happen.
The negotiations came days after Pakistan’s military announced prison sentences for 25 people involved in the May 9, 2023, protests, which PTI has demanded be investigated. The military said it had gathered “irrefutable evidence” against those prosecuted and reiterated its commitment to bringing the planners of the violence to justice.
The country has remained gripped by political unrest and uncertainty since Khan’s ouster from power through a parliamentary no-confidence vote, which has also exacerbated Pakistan’s economic hardships.
Senior government representatives have previously acknowledged that negotiations could offer a pathway out of the current political impasse. However, they have cautioned that it is too early to determine which of PTI’s demands might be addressed.
Ancient winter festival in Pakistan’s Chitral concludes with rituals, traditional dance
- Chawmos festival is celebrated in December by the Kalash people, who are numbered around 4,000
- Festival marks welcoming of new year, celebrated with dance, animal sacrifice, singing and feasting
PESHAWAR: A religious winter festival celebrated by the Kalash people in the northwestern Pakistani district of Chitral has concluded after featuring rituals, traditional dance and other festivities for two weeks, provincial tourism authority said on Monday.
The Kalash are a group of about 4,000 people, possibly Pakistan’s smallest minority, who live in the mountains of the Hindu Kush, where they practice an ancient polytheistic faith.
They come together each year in December to celebrate the two-week Chawmos festival after the community finishes fieldwork and stores cheese, fruit, vegetables and grains for the year.
The festival features various rituals, animal sacrifice, dance, songs and feasting, preserving the Kalash culture and attracting a number of tourists to Pakistan’s Khyber Pakhtunkhwa.
“The religious Chawmos festival of the ancient Kalash Valley has concluded,” Mohammad Saad, a spokesperson for the KP Tourism Authority, said in a statement.
“The festival continued from Dec. 8 in the three valleys of Bumburet, Birir and Rumbur.”
The Kalash community’s religion incorporates animiztic traditions of worshipping nature as well as a pantheon of gods, and its people live mainly in the three Kalash valleys of Bumburet, Birir and Rumbur.
The Chawmos festival is celebrated to welcome the new year, with the Kalash people indulging in religious practices and distributing vegetables and fruit among each other, according to the official.
The festival was attended by a large number of domestic and foreign tourists who were fully facilitated by the provincial tourism authority.
Pakistan defense minister blames judiciary for delayed verdicts in May 9 cases
- National problems require decisions at the earliest, says Khawaja Asif while talking to media in London
- Protests erupted in several Pakistani cities on May 9, 2023, over ex-PM Imran Khan’s arrest in a graft case
ISLAMABAD: Pakistan’s Defense Minister Khawaja Asif on Sunday blamed the judiciary for delaying verdicts in the May 9, 2023, cases, which have so far led to the conviction of 25 supporters of former Prime Minister Imran Khan’s Pakistan Tehreek-e-Insaf (PTI) party for attacking government buildings and military properties last year.
On Dec. 21, the Pakistan Army sentenced 25 people for participating in the violent protests that erupted in several Pakistani cities following Khan’s brief detention on corruption charges, resulting in damage to major military facilities and martyrs’ monuments in the country.
However, several suspects are also facing legal charges in anti-terrorism courts, with the military hoping for early verdicts in their cases, according to a statement announcing the sentencing of the 25 individuals, which described the rioting as “politically provoked violence.”
The PTI has denied any involvement in the violence, describing the May 9 incident as a “false flag” operation aimed at crushing the party.
“The judiciary created the biggest hurdle in this [the conviction of May 9 suspects] while this thing was allowed to linger for one and a half years,” Asif said while speaking to the media in London, the city he is currently visiting.
Describing the May 9 protests as a national problem, he said all the cases related to it required verdicts at the earliest.
The conviction of the 25 individuals followed a ruling by a seven-member Constitutional Bench of the Supreme Court of Pakistan on Dec. 13, allowing military courts to share their verdicts. Prior to that, the court had unanimously declared last year that prosecuting civilians in military courts violated the Constitution.
Khan’s PTI party rejected the military’s announcement, with opposition leader Omar Ayub Khan saying they were “against the principles of justice.”
The sentencing of the 25 individuals also raises concerns about Khan, who faces charges of inciting attacks against the armed forces and may potentially be tried in a military court.
Earlier, Asif had regretted the delay in announcing the verdicts, saying that it “raised the morale of the accused and their facilitators.”
“Right now, only the workers, who were used [to generate violence], have been punished under the law,” he had said. “This will not end until the ones, who planned this terrible day, are not brought before the law.”
