Pakistan is heading for a major power crisis as there are shortages of natural gas supply at home and friendly countries have refused to extend any more credit for petroleum imports from abroad.
Pakistan had asked Kuwait to extend its credit terms from two months to six months while a request was made to Saudi Arabia to it extend its credit facility to a year.Kuwait steps back
But neither country has responded positively to the proposals said a report in the daily Express Tribune on Monday.
The problem with procuring oil imports is that state-owned oil distributor, Pakistan State Oil, owes its creditors over Pakistani Rs 200 billion in debts, say economists.
"This is a problem of circular debt. The consumers don't pay the power companies which in turn don't pay the oil companies.
Natural gas thins
As the country looks for other means to finance its oil imports, there is a shortage of natural gas at home. Local production of natural gas has been outstripped by supply with the result that there is phased load management in the winters.
"This is a temporary situation and we are making all efforts for this to be avoided in coming years," prime minister Yousaf Raza Gilani told reporters on Sunday.
In the past, natural gas would compensate for oil as fuel. But lines at CNG stations, where gas is supplied to vehicles on alternate days, are growing longer.
Earlier this month, natural gas rates were raised by over 30% so that the price was brought at par with petroleum products. A proposed gas pipeline from Iran has been stalled by US sanctions.