PSO Gets Govt Approval to Import Diesel On Behalf of All Petroleum Companies

Pakistan State Oil (PSO) has been granted the right to exclusively import high-speed diesel (HSD) to meet domestic demand. The Petroleum Division has agreed to PSO’s proposal to import HSD on behalf of the country’s oil marketing companies (OMCs). The Oil and Gas Regulatory Authority (OGRA) has been instructed to confer with the oil industry and finalize a framework for the agreement, which is likely to benefit the country in both economic and operational terms. PSO imports HSD from Kuwait Petroleum Corporation (KPC) under a government-to-government agreement, giving it an edge in terms of premium and LC settlement. While PSO still imported 90 percent of HSD in the past, importing the entire diesel stock would help not only meet demand but would also alleviate OMCs’ concerns about the domestic price of HSD based on PSO imports and related adjustments of premium and exchange rate. Premium is the amount paid above or below the market price of a petroleum product based on demand. Pakistan imports diesel to meet domestic demand since local refineries cannot produce enough to meet domestic needs.