Pakistan Economic Crisis: As Pakistan battles its worst economic turmoil – with inflation and unemployment rates reaching record highs – local media reports claimed citizens are now struggling hard to get fuel for their vehicles. According to a report in Pakistani media outlet Dawn, long queues were seen at several petrol pumps. People waiting in the queue while talking to the media said that the waiting time at the fueling stations was more than an hour.
According to reports, Pakistan’s capital Islamabad and Khyber Pakhtunkhwa province were the most affected cities as oil marketing companies reduced their imports. “I had to wait for almost half an hour to fill fuel at the GT Road petrol pump,” he was quoted as saying by Dawn newspaper. At least 20 more are standing there, he said.
The motorcyclist said he waited for about 50 minutes at a filling station in Fakirabad area. There is news of mass closure of petrol pumps in Mansehra district due to shortage of petrol. The Khyber Pakhtunkhwa CNG Administration on December 31 closed all CNG stations in the provincial capital for a month to ensure supply of natural gas to domestic consumers.
The News International reported this week that the gas crisis in Pakistan is set to worsen in February as ENI, a liquefied natural gas (LNG) trading company in Pakistan, has pulled back from an LNG cargo that was due to arrive on February 6-7. 2023, a senior energy ministry official confirmed.
Pakistan economic crisis
Significantly, the country is facing the worst economic crisis since three months of floods, which washed away almost all the major crops of the country. However, the situation was not “right” for Pakistan even before the natural disaster hit the country. According to several local media reports, even in the first week of August, edible oil sold at Rs 600 per liter and ghee at around Rs 700 per litre. The situation turned critical after deadly floods, in which more than 2,000 people died and thousands went missing.
In December, local media reported that the price of cooking gas rose to Rs 1,200 per kg near the Afghan border areas, while the price of flour rose to Rs 160-170 per kg.
Pakistan does not have much time to act
According to the publication’s official sources, the government does not have much time to act as foreign exchange reserves held by the State Bank of Pakistan (SBP) are rapidly depleting. As of January 6, the foreign exchange reserves with the SBP were just $4.3 billion.
Foreign exchange reserves of commercial banks stood at US$5.8 billion, making the country’s cumulative reserves around US$10.18 billion. SBP reserves declined by USD 12.3 billion in last 12 months; From US$ 16.6 billion on January 22, 2022 to US$ 4.3 billion on January 6, 2023, The News International reported.
The report said that friendly countries such as Saudi Arabia are “studying” the possibility of depositing an additional $2 billion, but it is not yet clear how long it will take them to make a decision.