Pakistan initiates gas subsidy reforms and petroleum reserve study

Pakistan’s Federal Petroleum Minister Ali Pervaiz Malik has initiated several reforms aimed at enhancing the country’s energy security and financial sustainability. Malik has called for a comprehensive review of the existing gas subsidy system and pricing slabs to move toward a more uniform pricing model. He emphasized that while vulnerable segments should be protected through targeted social protection programs, the sector requires reforms to improve efficiency and transparency.

During a review of the Sui Southern Gas Company Limited (SSGCL), officials reported a 57 percent reduction in the Unaccounted-for-Gas (UFG) rate. Malik directed the company to prioritize addressing gas supply issues in Balochistan, tackling gas theft, and improving infrastructure. He noted that the government is working on sector-wide reforms with support from the World Bank.

In a separate strategic move, the Petroleum Division has launched a feasibility study to establish Strategic Petroleum Reserves (SPR) in Pakistan. The international consultancy Wood Mackenzie has been selected to conduct the study. The initiative aims to build resilience against external supply shocks and global energy landscape disruptions, such as those seen in the Strait of Hormuz, by assessing how the country can best prepare for potential supply interruptions.