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Featured Pakistan Forced to Buy Priciest LNG Shipments to Avoid Blackouts

Jungibaaz

RETIRED MOD
Jul 4, 2010
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I think it was the wrong gamble to make, we should have secured supply well in advance rather than panic buying spot after prices have soared and supply side constraints are setting in everywhere.

This is why forward agreements are often advisable even if the upside risk is missing from them.

And the fact that we’ve seen a steady rise in prices on the market, and nothing was done, that’s inexcusable.

Zardari and Nawaz Sharif must be hanged!
Read the news properly; they are irrelevant here
 

farok84

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May 26, 2010
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I think it was the wrong gamble to make, we should have secured supply well in advance rather than panic buying spot after prices have soared and supply side constraints are setting in everywhere.

This is why forward agreements are often advisable even if the upside risk is missing from them.

And the fact that we’ve seen a steady rise in prices on the market, and nothing was done, that’s inexcusable.
Hi,

I beg to differ. It wasn't a mistake but indeed a bold and a very risky move. At the time of first tender, that is July 6th, the price futures in both European (TTF) and Asian (JKM) markets fell by 10% in a matter of couple of days. You can verify this on ICE or any other futures platform. Our offered prices at the time were 20-25% higher. If the government had accepted those bids, all the people criticizing it now, would have criticized it then, for accepting prices upto 25% higher.

If anyone wants to criticize, criticize our out-dated procurement regime, which is not aligned with the global market. We should look into 1-2 cargo/ month supply at a fix rate annual tender, instead of these monthly spot purchases. We will be less exposed to market fluctuations this way but will be hard to sell politically. I am not a fan of Tabish Gohar, but this move actually showed people at PD were keeping close eye on the market fluctuations, and took the risks accordingly. If it didn't pay off this time, doesn't mean they were wrong.
 

DHSquare

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Jul 7, 2014
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I am asking a simple question "Why government cancelled earlier bids at lower price and bought at higher price from company after a few days at much higher prices for the third time in three months??" and instead answering this simple question you running from north to south.
Everyone plz come forward n pay ur Salaam to this post 😂
 

BRAVO_

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Apr 12, 2015
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seems the bureaucracy and top management engaged in petroleum department are one of the leading unprofessionals as they have no forecasting skill at all on top of it petroleum ministry is run by mafias they have no logic whatsoever about this deal
 

niaz

PDF THINK TANK: CONSULTANT
Jun 18, 2006
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Spot prices will always fluctuate that is why long term contracts for base load is a good idea and most gas supply and power companies and countries enter into such contract. Only about quarter of the demand is met by spot purchases to take advantage of the spot price drop. Additionally this strategy assures long term supply continuity.

Tragedy in Pakistan is that each time the LNG price drops in the spot market, it is assumed that the person responsible for signing the contract has lined his pockets at the expense of the country.
 
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Osman Devlat

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Will ya all stop fighting, let's face it, we always have had an inefficient government. Just pray that we can get competent people, even if there are 4-5 competent people in high ranks, and on whose advice the government listens to everything will be great, but no one in the gov. gives a damn (because after all bhai, ye pakistan hai.) .
 

silverox

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Nuclear power plants or hydropower stations can be built. Unfortunately, Pakistan’s Balochistan Liberation Army terrorist attacks specifically targeted Chinese companies. I saw on Twitter that Balochistan Liberation Army supporters insulted Pakistan, saying that they have no water or electricity, so they demanded independence. , Leave Pakistan. But they attacked the Chinese who were building hydropower stations. I really can't understand their way of thinking
 

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