ISLAMABAD: As tensions between Iran and Israel threaten to disrupt global oil supplies, the Pakistani government is scrambling to secure alternative fuel options and safeguard national energy security.
The Oil and Gas Regulatory Authority (OGRA) has issued a fresh warning to oil marketing companies (OMCs), instructing them to strictly maintain the mandatory 20-day oil stock levels required under their licences. OGRA cautioned that non-compliance would result in fines and penalties.
In a statement, OGRA confirmed that current petroleum reserves are sufficient to meet domestic demand. However, the regulator emphasised the need for vigilance in the face of potential supply disruptions.
“OGRA is closely monitoring developments and remains committed to taking proactive measures to protect the country’s energy security,” a spokesperson said.
High-level committee explores alternatives
In response to the growing risk of supply shocks, Prime Minister Shehbaz Sharif has formed a high-level committee to review Pakistan’s oil supply strategies and pricing mechanisms. Headed by Finance Minister Muhammad Aurangzeb, the panel includes senior officials from key ministries, regulatory bodies, and the energy sector.
The committee has already convened its first meeting and is set to reconvene next week to evaluate contingency plans and alternative supply routes.
Discussions focused on bypassing potential chokepoints like the Strait of Hormuz, which handles about 20% of global crude exports and could become a flashpoint if hostilities intensify.
Officials reviewed options including Saudi Arabia’s East-West Pipeline (Petroline), which carries crude from the eastern province to the Red Sea port of Yanbu, and the UAE’s Abu Dhabi Crude Oil Pipeline (Adcop) to Fujairah — both designed to avoid the strait.
Strategic reserves and storage solutions
The Petroleum Division reported that any closure of the Strait of Hormuz could send global crude prices soaring to between $100 and $150 per barrel, significantly impacting Pakistan.
While no immediate oil shortage or price spike has been reported, authorities have initiated discussions with international suppliers to secure uninterrupted flows.
Experts have urged the government to utilise up to one million tons of available furnace oil storage capacity at decommissioned power plants as strategic reserves. There are also proposals for the government to acquire these storage sites, as they are slated for disposal by the power sector.
