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Why does Pakistan import oil even though it has domestic oil fields?

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Pakistan possesses domestic petroleum reserves, primarily located in the Potwar Plateau and Sindh, but these modest quantities are insufficient to meet the country's rapidly growing energy demands.1

The primary reasons for Pakistan's reliance on imported crude oil include:

  • Consumption vs. Production: Domestic energy production has not kept pace with the country's rising consumption, necessitating increasing imports to satisfy demand.1
  • Refinery Capacity: Pakistan’s existing refinery capacity significantly exceeds its domestic crude oil production, making the importation of foreign crude necessary to utilize these facilities fully.1
  • Economic Vulnerability: Because the country relies on imports to bridge the gap between domestic supply and total demand, it remains vulnerable to fluctuations in global oil markets.1

While the government continues to encourage exploration, including offshore drilling, the persistent gap between supply and demand has made oil a major component of the country's imports.12