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Amid reeling economic crisis and shortage of foreign exchange reserves, Private dealers in Pakistan have turned to Iran for less expensive fuel as the country's inflation rate has hit historic highs during the past few months, Geo News reported.
According to refinery sources and market analysts, the popularity of Iranian oil had a negative impact on local refineries' volumes and was projected to have a negative impact on their sales in the second quarter of 2023. As a result of the weakening economy and individuals using public transit due to rising costs, local refineries were already experiencing a drop in demand. In recent months, the average retail price of diesel in Pakistan was (PKR) 288 per litre, whereas Iranian fuel has been selling for as little as (PKR) 230 per litre, generating respectable profits for private dealers, reported Geo News. Since the United States sanctions the neighbouring nation's commerce in petroleum and petrochemicals in 2013, Pakistan has been prohibited from importing Iranian oil. Authorities were allegedly turning a blind eye to the imports due to depleting foreign reserves, according to refinery sources and analysts at Insight Securities. "Infiltration of Iranian diesel is growing and it could substitute as much as 25-30 per cent of Pakistan's total diesel sales," a private dealer said, according to Geo News. Local refineries are on the verge of shutdown in Pakistan as Iranian oil had "never been on this huge and unparalleled scale in the South-Asian country". (ANI)
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