Oil refineries in Pakistan start shutting down due to oil market crash
Lately, the whole World has been shackled by the ongoing pandemic which has led to economic crisis and businesses are struggling to survive. The price competition between Russia and the Gulf nations on crude has resulted into a negative price of oil. As a result, the oil refineries in Pakistan have also been affected by these price fluctuations and have endured huge losses in past months. .
The five oil refineries operating in Pakistan have informed the government that they can no longer continue to work and are close to shutting down the refineries amid COVID-19 crisis. They raised major concerns that the price of petrol has come to equal half of crude and the diesel prices are now equal to previous prices of crude, while more losses are expected in the month of May.
The Managing Directors (MDs) of five refineries that include National Refinery Limited (NRL), Attock Refinery Limited (ARL), Pak-Arab Refinery (PARCO) and BYCO attended a meeting held on Thursday with Special Assistant to PM on Petroleum Nadeem Babar in attendance as well, and apprised the SAPM of the huge losses suffered and requested the government to come up with a bailout package to avoid shutting down of the refineries, as per report published by The News on Friday.
Three out of five oil refineries have braved a loss of Rs.16 Billion whereas the other two refineries will also make their losses public in the coming days. The losses will rise once the financial data of refineries from April begins to turn up.
According to the report published in The News, the government has asked the refineries to come up with possible bail out packages which will be sent to petroleum division and ministry of finance for further assimilation and Atonement. The government is of the view that the oil refineries are one of the most valued assets of the country and cannot be left hanging in this crucial time. Government intends to cooperate fully with the refineries to prevent these from collapsing and crashing given their strenuous ordeal.