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Pakistan’s oil industry faces collapse amid liquidity crunch

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Pakistan’s oil companies have warned that the industry is on the “brink of collapse” as the dollar liquidity crisis persists and their cost of doing balloons due to the Pakistani rupees (PKR) devaluation.

To meet the International Monetary Fund’s (IMF) demand, the government removed the dollar cap, resulting in the rupee falling to a historic low of 276.58 PKR in the interbank market, Geo News reported.

In a letter to the Oil and Gas Regulatory Authority (OGRA) and Energy Ministry, the Oil Companies Advisory Council (OCAC) said that the “sudden depreciation” of the local rupee has caused losses worth billions of rupees to the industry as their letters of credit (LCs) are expected to be settled on the new rates, “whereas the related product has already been sold”.

The government has also restricted LCs due to dwindling foreign exchange reserves, which fell to $3,086.2 million as of January 27, and are enough for just 18.5 days, Geo News reported.

Pakistan is facing a balance of payments crisis and the plummeting value of the rupee is pushing up the price of imported goods.

Energy comprises a large chunk of Pakistan’s import bill.

Pakistan typically meets more than a third of its annual power demand, using imported natural gas, prices for which shot up following Russia’s invasion of Ukraine.

These losses, the OCAC said, not only have an impact on the profitability of the sector, which is already under severe pressure, but also on its viability since these setbacks in some cases might exceed the “entire year’s profit for the sector”, Geo News reported.

“It is requested to urgently revise this mechanism and ensure that exchange losses of the sector are fully reimbursed if the viability of the industry and supplies to retail outlets are to be ensured,” the OCAC told the authorities.

The letter mentioned that OGRA has adopted the practice of not fully passing on the impact of the rupee depreciation and instead putting an immense burden on the sector.

Due to the challenges still being faced by the sector of previous exchange rate adjustments and the enormous impact of the current depreciation, the OCAC said it is crucial that OGRA passes the impact of the exchange rates in one go and not stagger this compensation, Geo News reported.

The council added that due to an increase in oil prices and successive depreciation of the Pakistani rupee over the last 18 months, the trade finance limits available from the banking sector to the industry have become inadequate.

As a result of the recent devaluation alone, the LC limits have overnight shrunk by 15-20 per cent, the OCAC said.

International News

Thailand, Cambodia Clash With Jets, Rockets, Artillery In Deadly Border Row

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Thailand launched air strikes on Cambodian military targets on Thursday as Cambodia fired rockets and artillery, killing a civilian, in a dramatic escalation of a long-running border row between the two neighbours.

The neighbours are locked in a bitter spat over an area known as the Emerald Triangle, where the borders of both countries and Laos meet, and which is home to several ancient temples.

The squabble has dragged on for decades, flaring into bloody military clashes more than 15 years ago and again in May, when a Cambodian soldier was killed in a firefight.

The conflict blazed up on Thursday, with Cambodia firing rockets and artillery shells into Thailand and the Thai military scrambling F-16 jets to carry out air strikes.

Six jets were deployed from Ubon Ratchathani province, hitting two “Cambodian military targets on the ground”, according to Thai military deputy spokesperson Ritcha Suksuwanon. 

The Thai prime minister’s office said a Cambodian artillery shell hit a house over the border, killing one civilian and wounding three others, including a five-year-old child.

Both sides blamed the other for starting the fighting, which erupted near two temples on the border between the Thai province of Surin and Cambodia’s Oddar Meanchey.

“The Thai military violated the territorial integrity of the Kingdom of Cambodia by launching an armed assault on Cambodian forces stationed to defend the nation’s sovereign territory,” defence ministry spokeswoman Maly Socheata said in a statement.

“In response, the Cambodian armed forces exercised their legitimate right to self-defence, in full accordance with international law, to repel the Thai incursion and protect Cambodia’s sovereignty and territorial integrity.”

The Thai military blamed Cambodian soldiers for firing first, and later accused them of a “targeted attack on civilians”, saying two BM-21 rockets had hit a community in Surin’s Kap Choeng district, wounding three people.

According to the Thai military, the clashes began around 7:35 am (0035 GMT) when a unit guarding Ta Muen temple heard a Cambodian drone overhead.

Later, six armed Cambodian soldiers, including one carrying a rocket-propelled grenade, approached a barbed-wired fence in front of the Thai post, the army said.

Thai soldiers shouted to warn them, the army said, but around 8:20 am, Cambodian forces opened fire toward the eastern side of the temple, about 200 metres from the Thai base. 

Thailand’s acting Prime Minister Phumtham Wechayachai said “the situation requires careful handling, and we must act in accordance with international law”.

“We will do our best to protect our sovereignty,” he said.

Thailand’s embassy in Phnom Penh urged its nationals to leave Cambodia “as soon as possible” unless they had urgent reasons to remain, in a Facebook post.

Long-Running Row 

The violence came hours after Thailand expelled the Cambodian ambassador and recalled its own envoy in protest after five members of a Thai military patrol were wounded by a landmine. 

Wechayachai said an investigation by the Thai military found evidence that Cambodia had laid new landmines in the disputed border area — a claim denied by Phnom Penh.

On Thursday morning, Cambodia announced it was downgrading ties to “the lowest level”, pulling out all but one of its diplomats and expelling their Thai equivalents from Phnom Penh.

Recent weeks have seen a series of tit-for-tat swipes by both sides, with Thailand restricting border crossings and Cambodia halting certain imports.

The border row also kicked off a domestic political crisis in Thailand, where prime minister Paetongtarn Shinawatra has been suspended from office pending an ethics probe over her conduct.

A diplomatic call between Paetongtarn and Hun Sen, Cambodia’s former longtime ruler and father of Prime Minister Hun Manet, was leaked from the Cambodian side, sparking a judicial investigation.

Last week, Hun Manet announced that Cambodia would start conscripting civilians next year, activating a long-dormant mandatory draft law.

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International News

Mumbai Police Reach Kapil Sharma’s House After Kap’s Cafe Firing In Canada

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Hours after shots were fired at comedian Kapil Sharma’s eatery, Kap’s Cafe, in Canada, the Mumbai Police on Friday reached his house in Mumbai to question him about the incident. Around 1 am on July 9 (Canada time), several rounds were fired at the cafe, located in Surrey.

Khalistani terrorist Harjeet Singh Laddi claimed the responsibility for the attack, and demanded an apology from Kapil for his alleged objectionable remarks.

the attackers felt that Nihang Sikhs were insulted on Kapil’s show. The report also mentioned that the attackers said the comedian ignored their calls seeking an apology, and that shots were fired at his eatery to warn him.

Kap’s Cafe team issues statement

Kapil is yet to issue an official statement on the incident.

The management of the eatery, however, took to their social media handles and wrote, “We opened Kap’s Cafe with hopes of bringing warmth, community, and joy through delicious coffee and friendly conversation. To have violence intersect with that dream is heartbreaking. We are processing this shock but we are not giving up (sic).”

It further stated, “Your kind words, prayers, and memories shared via DM mean more than you know. This cafe exists because of your belief in what we’re building together. Let’s stand firm against violence and ensure Kap’s Cafe remains a place of warmth and community. From all of us at Kap’s Cafe, thank you and see you soon, under better skies (sic).”

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Iran warns it will target Israel’s ‘secret nuclear sites’ if attacked

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Tehran, June 10: Iran’s top security body warned that its armed forces would immediately target Israel’s “secret nuclear facilities” if the Islamic Republic comes under military attack, following claims it has obtained “sensitive Israeli intelligence.”

The Supreme National Security Council (SNSC) issued the statement days after Intelligence Minister Esmaeil Khatib said Iran had acquired a “significant cache” of Israeli documents through intelligence operations, Xinhua news agency reported.

According to the council, months of intelligence gathering had enabled Iran’s armed forces to identify high-value Israeli targets for potential retaliatory strikes, should Israel initiate military action against Iranian interests.

“This forms part of a broader strategic initiative aimed at countering disinformation by hostile actors and reinforcing Iran’s deterrent capabilities,” the SNSC said.

Tehran’s access to Israeli intelligence would allow it to swiftly target “concealed nuclear sites” in the event of an Israeli strike on Iranian nuclear infrastructure, the council said, adding that the information also supports proportionate retaliation against attacks on Iran’s economic or military assets.

Israel is believed by many to possess nuclear weapons, though it has never officially confirmed or denied this, maintaining a longstanding policy of strategic ambiguity.

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