Cost-saving: Govt orders PSO to transport fuel via rail

KARACHI: In order to save transportation cost, the federal government has directed the Pakistan State Oil (PSO) to use rail for fuel transportation rather than roads.

According to estimations, the fuel transportation cost via rail will be 26% lower in comparison to road movement.

The Economic Coordination Committee (ECC) of the cabinet, in a recent meeting, directed PSO to use the infrastructure of Pakistan Railways for transporting 2 million tons of high-speed diesel (HSD) at competitive rates.

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It is reported that cargo service of Pakistan Railways, especially oil transportation, had remained profitable over the past four decades, but the Pakistan Peoples Party (PPP) administration, shifted the entire petroleum supply business to oil tankers.

The transportation cost rises as oil tanker owners not only been charge higher transportation rates, but they also reportedly blackmail the government by calling strikes on different occasions, which resulted in suspension of oil supply across the country.

Railways Minister Sheikh Rashid Ahmed told the ECC that HSD supply through Pakistan Railways to upcountry destinations was also discussed by the Cabinet Committee on Energy in a meeting held in mid-March.

The minister informed that that Pakistan Railways had remained a business partner with the PSO for the past four decades through economical and environment-friendly transport arrangements.

He said a formal written deal was signed on May 24, 2017 for the transportation of 2 million tons of furnace oil.