ISLAMABAD — Prime Minister Shehbaz Sharif on Tuesday directed federal authorities to urgently increase the country’s strategic petroleum reserves, a critical move aimed at buffering Pakistan against severe energy supply shocks caused by the ongoing US-Iran war that has choked shipments through the Strait of Hormuz. The premier issued these directives while chairing a high-level meeting of the Cabinet Committee on Energy (CCoE), which officially approved pivotal amendments to the Pakistan Oil Refining Policy 2023. PM Shehbaz emphasized that modernizing brownfield refineries is a core pillar of Pakistan’s comprehensive energy security, noting that it will significantly reduce reliance on expensive fuel imports, upgrade domestic output to eco-friendly Euro-V standards, and fulfill the country’s international climate commitments by slashing the production of low-quality furnace oil.
To catalyze international interest, the prime minister ordered immediate investment roadshows to be held in Qatar, Saudi Arabia, and other Gulf nations to promote the amended refinery framework. The policy shift comes as the government scrambles to rescue a stalled $6 billion investment package from the country’s five major domestic refineries. The multi-billion-dollar upgrades had repeatedly hit roadblocks due to flawed negotiations under the International Monetary Fund (IMF) program—specifically regarding sales tax exemptions on refinery equipment—and previous fiscal budget measures that had nullified critical investment incentives. To streamline the energy sector, PM Shehbaz also mandated swift institutional reforms within the Oil and Gas Regulatory Authority (Ogra) to ensure market transparency and foster healthy commercial competition.
