Page 30 - CMA Journal (Mar-Apr 2026)

Figure 4: Energy Consumed and GDP Growth

Source: Pakistan Energy Yearbook, 2024-25 and SBP

Pakistan's Exposure to Global Energy Disruptions In the gas sector, import dependency was 29% in FY2025.
LNG import demand has decreased by 40% in recent years
Pakistan's economy has remained structurally exposed to due to lower demand from the two primary consumers:
global energy price shocks due to its signi cant import RLNG-based power plants and captive power plants. To
dependence (41% in FY2025). Despite recent advances in regulate gas pressure in the pipeline distribution system, the
diversifying the energy mix, the country still relies heavily on ow of natural gas from local elds has been reduced
imported energy for transport, industry, households, and multiple times whenever there is an LNG surplus (Malik,
the electricity sector. 2025). In January, Pakistan had to divert excess LNG
The petroleum group, including LNG and LPG, is the largest shipments to other countries.
item in Pakistan's import bill, accounting for 20% to 30% of Despite the decrease, electricity generation is still the
total goods imports in USD, variations in uenced by leading LNG consumer. Pakistan has a long-term LNG import
prevailing prices and exchange rates. In FY2025, these agreement with Qatar. Qatar's declaration of force majeure
imports were approximately $16 billion (27% of total on LNG supplies could be a blessing in disguise given the
imports) (PBS, 2026). declining demand. But in summer, this may pose challenges
for the sector during peak hours, requiring the use of costly
Since FY2021, energy consumption has decreased. Many
analysts attribute this to increasing solar adoption. Solar did furnace oil to meet demand and thereby signi cantly
increasing electricity costs.
contribute, but it is primarily due to the low economic
growth trajectory, which has signi cantly affected energy Moreover, structural inefficiencies – system losses and
consumption (Figure 4). circular debt, further weaken electricity supply reliability. On
the positive side, the rapid growth of solar can help reduce
On average, 70-80% of crude processed in Pakistan's ve
electricity bills for many, but it also poses challenges due to
re neries is imported. Re neries still rely largely on hydro
outdated infrastructure and excess installed capacity.
skimming technology; the products they produce are
insufficient to meet local demand - 48% of consumed Global Price Changes and Domestic Prices
petroleum products are imported. Gasoline (petrol) and
High-Speed Diesel (HSD) are the two major petroleum As the con ict escalated, the Platts petrol benchmark rose
products consumed in the country, together accounting for from $111.54/BBL on February 26, 2026, to $138.18/BBL
90% of total petroleum product consumption. In FY2025, (April 2, 2026). Diesel prices reached a historic peak of
70% of petrol and 29% of HSD consumed were imported. $230.50/BBL, up from $119.80 at the start of the con ict. This
Pakistan is also importing high-octane and aviation fuels for led to a signi cant increase in import costs for Pakistan,
60% and 50% of its needs; though the share of these which will be re ected in the current account and foreign
products is relatively small, 1.8% and 3%. exchange reserves in April.

28 ICMA’s Chartered Management Accountant, Mar-Apr 2026