Turn on your stove in Islamabad or Rawalpindi, and you might just get six hours of faint blue flame a day. If you live in Balochistan, expect to pay a staggering PKR 7,000 for a 12kg cylinder of LPG as prices skyrocket past PKR 600 per kilo. Pakistan's energy sector is trapped in a vicious loop where domestic wells run dry, imported liquefied natural gas piles up unsold, and the financial liability crosses multi-trillion-rupee territory.
It is a striking economic paradox. The nation faces severe winter energy shortages while simultaneously grappling with surplus imported liquefied natural gas (LNG) that it cannot easily absorb. Long-term supply contracts locked in rigid terms fail to match shifting domestic realities, such as the rapid rise of rooftop solar power and falling grid demand.
Understanding the Energy Mismatch
Part of the confusion stems from treating all gas as if it is identical. Natural gas comes straight from underground fields through a pipeline network. When domestic output drops—falling by nearly 20% over a five-year window due to mature field depletion and lackluster exploration—the country fills the gap with seaborne imports.
Liquefied natural gas arrives by ship in liquid form, gets regasified at coastal terminals, and enters the domestic grid. But importing fuel costs significantly more than domestic extraction. When state-regulated household tariffs stay far below the actual cost of supply, distributing expensive regasified LNG creates immediate financial hemorrhage instead of solving shortages.
Meanwhile, families cut off from piped networks rely entirely on liquefied petroleum gas (LPG). When cross-border trade disruptions stall shipments from neighbors like Iran, cylinder prices spike overnight. Households in urban centers start turning to coal and firewood just to cook daily meals.
The Staggering Cost of Circular Debt
At the root of the dysfunction lies an escalating financial burden. Federal data presented in the National Assembly reveals that the country's gas-sector circular debt and outstanding supplier liabilities hit PKR 5.454 trillion by mid-2026. This massive total includes PKR 3.631 trillion in core circular debt and another PKR 1.823 trillion owed directly to fuel suppliers.
Think tanks like the Institute for Energy Economics and Financial Analysis point to deep structural leaks. Unaccounted-for gas—driven by commercial theft and aging infrastructure—swallows roughly 11.7% of all gas handled. When state utilities like Sui Southern Gas Company fail to recover revenue, they cannot pay producers. Producers then halt new drilling, accelerating the decline of local fields.
What Comes Next for Consumers
International lenders like the International Monetary Fund continue pushing for aggressive structural overhauls. Officials face tough choices: phasing out blanket subsidies in favor of direct cash transfers for low-income households, clamping down on widespread gas theft, and renegotiating inflexible import contracts.
Until these systemic fixes take hold, minor adjustments will only delay the next crunch. The skyrocketing cost of cooking fuel is merely the visible symptom of a deeper fracture across Pakistan's entire energy landscape.
