Business

Pakistan fails to secure LNG cargoes in first attempt in about a year

Published

2 years ago

Farwa

Pakistan’s bid to purchase six shipments closed Tuesday.
No company responded to cash-strapped nation’s offer.
Inability to buy gas will aggravate energy shortages.

Crises-hit Pakistan has failed to secure liquified natural gas (LNG) from the spot market in its first attempt in about a year, as no supplier seems to budge to the cash-strapped nation’s offer, Bloomberg reported Tuesday.

Traders, on the condition of anonymity, told the publication that Pakistan LNG Limited’s (PLL) bid to purchase six shipments for October to December closed Tuesday with no companies responding to the offer.

Many overseas banks were not accepting letters of credit (LCs) from Pakistani financial institutions to procure LNG shipments, making suppliers reluctant to offer cargoes, the publication reported last week.

The $350 billion economy is struggling with a depreciating currency, political turmoil, and an increased risk of a default on its foreign debt.

To top it off, the International Monetary Fund (IMF) came down hard on the federal government’s recently presented budget, a sign that the June-end deadline to unlock the funds won’t be met.

Pakistan’s inability to buy gas will aggravate energy shortages in the country, increasing the frequency of blackouts and curbing the supply of fuel to industrial consumers.

The nation was hit hard by the energy crisis spurred by Russia’s invasion of Ukraine last year due to its high dependence on imports. Several similar tenders by Pakistan last year also failed to gain offers from suppliers.

Business

E&P Companies Will Invest $5 Billion in Pakistan’s Petroleum Industry

Published

2 days ago

Farwa

Over the next three years, local and foreign companies involved in Pakistan’s oil and gas exploration and production sector have shown a strong desire to invest more than $5 billion in the nation’s energy sector.

Recent changes to the Petroleum Policy and the implementation of an exclusive tight gas policy, which provide better incentives and a more investor-friendly regulatory framework, are credited with the increase in investor confidence.

These strategic changes are expected to boost domestic energy production, open up new avenues for growth, and draw large amounts of both domestic and foreign investment.

Business

With inflation slowing, the SBP is anticipated to lower the policy rate for the eighth time in a row.

Published

2 days ago

Farwa

Businesspeople anticipate another reduction in the policy rate when the State Bank of Pakistan’s (SBP) Monetary Policy Committee (MPC) releases the updated rate.

The interest rate for the upcoming two months will be announced by the central bank. It is still unclear if the rate will stay the same or be lowered to reflect stakeholder expectations.

According to experts, the policy rate will be lowered in order to further boost the nation’s economic sector.

Interest rates may be lowered for the seventh time in a row if the inflation rate declines significantly more than anticipated.

In its last six sessions, the MPC had cut the policy rate by 10 percent. In January 2025, it decreased the rate by one percent to 12pc.

12PC POLICY RATE

In January, the State Bank of Pakistan (SBP) announced cut in key policy rate by 100 basis points (bps) to 12 percent from 13pc in line with expectations of the business community.

The policy rate, which had been at 22 percent since June 2024, was slashed by 1,000 basis points to 12 percent.

The SBP governor said the decision was taken with careful consideration. “Although inflation is expected to decline next month (February), core inflation remains a pressing concern,” he stated.

Ahmed highlighted strong remittance inflows and robust export growth as key factors supporting the current account.