THE Strait of Hormuz closed on Feb 28, 2026.
asserted
Strait → close → Feb
Within days, QatarEnergy declared force majeure.
asserted
QatarEnergy → declare → majeure
Pakistan, which sourced almost all its LNG from Qatar, asked Saudi Arabia to reroute crude through the Red Sea and released gas it had been holding back for weeks.
asserted
it → source → weeks
There was no gas storage and very little oil storage to fall back on, because none had ever been built.
asserted
none → be → ?
The timing made it worse.
asserted
it → make → ?
Years earlier, Pakistan signed long-term LNG contracts.
asserted
Pakistan → sign → contracts
Then IMF-driven tariff changes made gas too expensive for industries running captive power plants, and they switched to solar.
asserted
they → drive → solar
Demand fell just as the country was locked into more gas than it needed.
asserted
it → fall → gas
The pipelines reached the capacity threshold and the authorities curtailed up to 350 mmcfd of domestic gas.
asserted
authorities → reach → gas
Then the strait closed, Qatari cargoes were stranded, and the curtailed fields had to be switched back on within weeks.
asserted
fields → close → weeks
Policymakers have known for decades that Pakistan needs oil and gas storage, but have done little about it.
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Pakistan → know → it
Gas storage works by pumping surplus gas into depleted reservoirs when demand is low and drawing it back out when supply runs short.
asserted
supply → work → it
As early as 2004, an ADB study examined 107 locations and recommended two depleted fields in Badin, and a 2022 study added a third.
asserted
study → examine → third
Exploration companies operate these fields and could convert them, but no commercial model has been settled.
uncertain
model → operate → them
A guaranteed return for investors, the model that inflated power costs for two decades, would be a mistake.
asserted
that → guarantee → decades
It paid for capacity whether used or not, and gave sponsors little reason to control costs.
asserted
It → pay → costs
Competitive bidding works the other way: developers compete on the fee they charge to store and return gas, overrun risk stays with them, and the state only sets the terms.
asserted
state → work → terms
Feasibility tenders were issued in 2024 and again in 2026, a month before the strait closed.
asserted
strait → issue → 2026
Even then, the first facility will cover only 11 to 12 days of consumption, against the month officials say is needed.
asserted
officials → cover → month
Oil storage has failed for its own reasons.
asserted
storage → fail → reasons
The main one is that no one is paid to hold it.
asserted
one → pay → it
Marketing companies must keep 20 days of cover, but prices are revised every fortnight, so extra stock risks a loss whenever prices fall, and the pricing formula does not recover the cost of tanks.
asserted
formula → keep → tanks
Most companies stay near the minimum, and the state has never built a strategic reserve of its own.
asserted
state → stay → own
Pakistan needs oil and gas storage.
asserted
Pakistan → need → storage
The idea of letting foreign suppliers hold fuel in Pakistan was first floated in 2015.
asserted
suppliers → let → 2015
In 2023, the government approved it: suppliers could keep product in bonded storage without paying duty, pay only when they sold locally, and re-export freely.
uncertain
they → approve → duty
Not one supplier has used it — for three reasons.
asserted
supplier → use → reasons
First, the rules require a foreign supplier to register a presence in Pakistan.
asserted
supplier → require → Pakistan
Large traders are used to storing oil in places like Fujairah in the UAE or Singapore without opening an office there.
asserted
traders → use → office
Asking them to do so here adds cost and paperwork for little benefit.
asserted
them → ask → benefit
Second, nothing guarantees a supplier can take its oil back out.
asserted
supplier → guarantee → oil
A future government facing a shortage could block exports, just when it would want to sell elsewhere.
uncertain
it → face → exports
Third, five bodies have a say: customs, the regulator, the State Bank, and the commerce and petroleum ministries.
asserted
bodies → have → customs
Each writes its own rules, and no one makes them fit together.
asserted
them → write → rules
The current government has reopened the policy, an admission that it has attracted no investment.
asserted
it → reopen → investment
The strait showed that fuel stored in the Gulf can be cut off without warning.
asserted
fuel → show → warning
Fuel held in Pakistan by foreign suppliers, available for local sale, would give the country a cushion next time.
asserted
Fuel → hold → cushion
The fix requires detail, not reinvention.
asserted
fix → require → detail
The rules must state who can take part without a Pakistani company, how ownership changes when part of a tank is sold, how banks process those sales, and which single office settles disputes.
asserted
office → state → disputes
Traders choose where to store oil based on how fast licences come and whether rules stay stable.
asserted
rules → choose → oil
…and 9 more, not listed.
The Aporia
