Islamabad/Karachi: Pakistan State Oil (PSO) has attracted bids from international traders for two petrol cargoes, each carrying 55,000 metric tons of 92 RON petrol, as the country navigates supply challenges amid rising global fuel price volatility and tensions in the Strait of Hormuz.
Bidding Details
For the first cargo, OQ Trading submitted the lowest bid with a Cost and Freight (CFR) premium of $17.8 per barrel. Be Energy SA offered a CFR premium of $22 per barrel, while Vitol Bahrain E.C. quoted the highest at $39 per barrel.
For the second cargo, only two bidders participated, with OQ Trading again offering the lowest premium at $19.5 per barrel, and Be Energy SA at $23.5 per barrel. Officials noted that even the lowest bids are considered relatively high, reflecting current uncertainties in international energy markets.
All bids were submitted under the Public Procurement Regulatory Authority (PPRA) rules, which govern public-sector procurement in Pakistan. Officials cautioned that strict tendering rules, while ensuring transparency, can sometimes contribute to higher procurement costs, especially during periods of price volatility.
The bids will remain valid until March 13, requiring PSO to finalize decisions before the deadline.
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Diesel Procurement Challenges
PSO reportedly received no bids for high-speed diesel, as traders demanded a CFR premium of around $80 per barrel, considered excessively high. Daily fluctuations in international petroleum prices have made suppliers reluctant to offer competitive quotes.
Meanwhile, Total Parco Pakistan Limited has arranged a cargo of Euro-II specification diesel at a CFR premium of $20 per barrel, pending government approval. PSO typically imports Euro-V diesel, which meets stricter environmental standards.
Domestic Supply and Agricultural Demand
Officials stated that Pakistan’s diesel stocks are currently sufficient for about 20 days, but demand is expected to rise significantly with the upcoming harvesting season, as agricultural machinery increases fuel consumption.
Authorities emphasized that ensuring affordable diesel supplies will be crucial to maintain uninterrupted farming operations and prevent volatility in the domestic fuel market.
