Pakistan is facing a worsening electricity crunch after rejecting an emergency liquefied natural gas (LNG) cargo at nearly three times pre-war spot prices, leaving the country with an increasingly difficult choice: pay a steep premium for fuel or risk more power cuts across cities.
State-owned Pakistan LNG Ltd. scrapped an emergency tender for a shipment due by September 8 after receiving a sole offer from BP Plc at $27 per million British thermal units (MMBtu), traders told Bloomberg. The government rejected the bid as too expensive and may reissue the tender later
This highlights how sharply the cost of replacing Pakistan’s disrupted Qatari supplies has risen as LNG flows through the Strait of Hormuz remain constrained amid the ongoing US-Iran war.
Also read: Pakistan in the dark again: 4,000 MW shortfall and fuel failures unleash crippling blackouts
Without additional LNG, Islamabad may have to continue rolling blackouts during the evening hours, when Pakistan’s rapidly expanding solar fleet stops generating power and fossil-fuel plants meet the remaining demand. The country has already been grappling with an energy crunch since the conflict in Iran began in late February, disrupting LNG flows from Qatar, its largest supplier.
The latest setback comes as QatarEnergy extended force majeure on LNG supplies to Pakistani buyers into October. LNG shipments through the Strait of Hormuz remain close to a standstill, even as some oil tankers have begun using alternative methods to move crude through the waterway.
The disruption has exposed a central vulnerability in Pakistan’s energy system: despite making progress in reducing dependence on imported fuel, the country still relies on LNG to bridge the gap between domestic electricity generation and demand, particularly after sunset, according to a factsheet released by the Institute for Energy Economics and Financial Analysis.
