Ogra okays import of 200,000 tonnes of HSD

KARACHI: Pakistan is set to import over 200,000 metric tonnes (MT) of high-speed diesel (HSD) in December as demand surges in recent weeks.

According to sources in the oil sector, the Oil and Gas Regulatory Authority (Ogra) has granted import approvals to Pakistan State Oil (PSO) for three cargoes and to a private oil marketing company (OMC) for one cargo. “The import of HSD may exceed these four cargoes as diesel demand continues to grow,” industry insiders told The News.

PSO will fulfil its diesel import under a long-term contract with Kuwait Petroleum Corporation (KPC), while the private OMC will manage one cargo independently, the sources added.The rising demand for HSD is attributed to a significant increase in legal sales following intensified anti-smuggling efforts by authorities, which have curtailed the inflow of smuggled diesel from Iran. Smuggled diesel, often of lower quality, is now largely confined to Balochistan, whereas it was previously distributed across the country.

Dealers of smuggled Iranian diesel confirmed reduced supply and reported that the resulting price hike has narrowed the price gap between smuggled and locally available diesel. This price convergence has discouraged heavy vehicle operators from using smuggled diesel.

The issue of diesel demand and supply has been contentious. In October, Ogra’s decision to grant a private OMC permission to import HSD sparked objections from local refineries, which argued that domestic production could meet demand. However, industry experts now assert that the current demand can only be met through both local production and imports.

Current HSD stock levels in the country stand at approximately 300,000 tonnes, down from around 500,000 tonnes a few months ago, reflecting a sharp increase in sales through legal channels in recent weeks.

Data compiled by the oil sector reveals that Pakistan imported 466,000 tonnes of HSD in the last four months. Imports in July amounted to 98,000 tonnes, followed by 147,000 tonnes in August, 131,000 tonnes in September, and 90,000 tonnes in October.