As petrol and diesel prices climb, Pakistani oil companies report profits in the billions

While Pakistani consumers carry the burden of costly petrol and diesel, several of the country’s oil refineries, oil and gas exploration companies and oil marketing companies have reported sharp rises in profit.

Refinery profits are up by more than 1,000 percent on a year earlier.

The war launched by the United States and Israel against Iran, and the resulting disruption in the Strait of Hormuz, unsettled global energy markets. Over that period international prices of crude oil, diesel and other petroleum products rose, and Pakistan felt the effect too.

About one-fifth (20 percent) of global energy trade passes through the Strait of Hormuz. Tension on that key sea route therefore disrupted global supply chains and pushed up oil and fuel prices in Pakistan and several other countries.

Before the war, petrol and diesel in Pakistan sold for roughly Rs276 and Rs287 a litre respectively. Prices then rose sharply in both international and domestic markets, going as high as Rs400 a litre.

In this extraordinary situation the government began setting petroleum prices daily, and the cost of expensive fuel also showed up in the prices of many everyday goods.

According to the Pakistan Bureau of Statistics, inflation stood at 7 percent in February and later climbed as high as 11 percent.

The financial results of Pakistan’s major oil refineries and other petroleum-related companies, however, tell a very different story.