To avoid evasion on international responsibilities, Pakistan State Oil (PSO) has sent an SOS to the government demanding for over Rs 100 billion. As under Covid-19 pandemic, many economic sectors of all-most all countries have been wedged severely, the oil industry is being affected badly. An excess has emerged due to reduction in country-wide demand for petroleum products. Previously, PSO’s liquidity position was already critical due to long outstanding receivables from various sectors. But under plague, PSO’s daily cash collection from its white oil business has drastically reduced by more than 55 percent. This critical liquidity position of PSO can trigger a potential fuel crisis in the country. Petroleum Division is striving to improve PSO’s financial health. SNGPL has already been directed to clear PSO’s debt through bank borrowings. Presently, PSO is facing severe cash flow constraints due to Covid-19 pandemic. It requires Rs 81.3 billion up to April 30, 2020 to retire international L/Cs to the suppliers of POL products and LNG. In order to maintain a smooth supply chain of petroleum products in the country, it has repeatedly sought the release of significant payment to PSO but to no productive step has been taken. However, in case of default on international payments, it will be the shared responsibility of all relevant Ministries /Divisions /organizations.
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