Pakistan State Oil (PSO) is seeking direct government support to avoid defaulting on letters of credit (L/Cs) due over the next few weeks.

The oil company says its receivables have risen to 151 billion rupees (Rs151 billion) because the government has been unable to resolve debt issues at state-owned entities.

Federal support

Now, PSO has asked the federal government to urgently clear Rs46 billion owed to the oil company.

This would help the company avoid default on L/Cs issued to Kuwait Petroleum Corporation and other fuel suppliers.

Debt payments

According to a PSO statement, it has a specific problem with the Water and Power Development Authority.

It has reportedly made a payment of just Rs125 million this month but owes PSO a further Rs46.8 billion due for payment over the next few days.

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