Pakistan's oil industry on brink of collapse, Rupee slides further

Pakistan's Prime Minister Shehbaz Sharif said that the government would have to agree to IMF bailout conditions that are "beyond imagination". "I will not go into the details but will only say that our economic challenge is unimaginable. The conditions we will have to agree to with the IMF are beyond imagination. But we will have to agree with the conditions," Sharif said in televised address on Friday. Hours after his remarks, the rupee hit a record low against the US dollar in a steep slide since last week. Pakistani currency hit a new historic low as the US dollar closed at Rs276.58 in the interbank market on Friday.

Interbank closing #ExchangeRate for todayhttps://t.co/22WDdOJ0oq pic.twitter.com/tgYeO2B6hC

— SBP (@StateBank_Pak) February 3, 2023

No relaxation in the IMF’s conditions have been made despite the government’s repeated requests. This continues to destabilise financial markets leading to economic uncertainty. An International Monetary Fund (IMF) delegation landed in Pakistan on Tuesday for last ditch talks to revive vital financial aid which has stalled for months.According to Geo News report, 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 rupee's 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 Rs276.58 in the interbank market.