Pakistan State Oil (PSO) has warned the government that its stocks of high speed diesel (HSD) and premier motor gasoline (PMG) are likely to deplete by the end of the current month due to low refinery production and import issues of crude oil.
Sources in Petroleum Ministry said that PSO in a letter addressed to the Ministry has requested for intervention to forestall the possibility of a severe oil shortage in the country by the end of the current month. PSO has also written a letter to the Oil Companies Advisory Committee (OCAC) urging it to hold an urgent meeting to resolve the issues of stocks of HSD and PMG which PSO is facing.
PSO had projected a sale of 410,000 tons HSD product during November, in the product review meeting of November 5, 2008, with daily sales calculated at 13666 tons. However, the present average sale of HSD has reached 16276 tons per day due to delayed sowing of Rabbi crops and crushing season of sugarcane. Due to increased sale of HSD, total sales had been projected at 488,000 tons, which would result in a deficit of 78,000 tons in the current month.
Sources said that any shortage in the high speed diesel could hurt the sowing of Rabbi crops, and wheat is the main crop that could be severely affected as a consequence.
The PSO had 25,629 tons HSD on November 2, which declined to 219,094 tons on November 11. These stocks would be enough to meet the domestic requirements for 13 days only. PSO has informed the government that it should have kept 71,856 tons HSD stocks, based on the projected sale of 410,000 tons on November 11. If actual sale is taken into consideration, PSO stocks would be completely exhausted by the end of the current month, PSO management said in a letter addressed to OCAC and Petroleum Ministry.
PSO management further said that it would have only two import cargoes of oil in December. Diminishing production of Parco, PRL and Biscor refineries would be the major contribution to PSO stock depletion. During the product review meeting held on November 5, 2008, PSO said it was facing a deficit of 25,800 tons PMG. PSO had projected sales of 60,000 tons and had shown serious concern over the demand/supply imbalance in consideration of low refinery production due to crude import issues and shutdown of PRL from November 3 during the first two weeks of November.
Since the beginning of November, PSO has been carrying out about 3 days'' stocks of PMG due to low refinery production. PSO was not importing PMG and it was receiving PMG from local refineries. Sources said that in the beginning of the current month, PSO had also pointed out the situation that its stock could lead to zero level due to low refinery production.
During first ten days of November, sale of PMG by PSO was recorded at 22,540 tons, which translated into 67,620 tons sale for the whole month of November. PSO has said that it is also facing problems due to already diminishing production of PMG from Parco. PSO has been pointing out the seriousness of this situation since September and said that unless some immediate measures were taken to address the situation, it was clear PMG stocks would completely dry out in the country by the end of the current month.
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