Pakistan International Airlines (PIA) cancelled 43 international and 29 domestic flights on Sunday due to unavailability of fuel. The cancellation was caused by a payment dispute between PIA and its fuel supplier, Pakistan State Oil (PSO).
PIA owes PSO Rs1.8 billion for fuel. The two companies agreed on a standard operating procedure (SOP) under which PIA would pay PSO in advance on a daily basis for the fuel.
PIA paid Rs100 million on Monday, Rs125 million on Tuesday, Rs150 million on Wednesday, Rs155 million on Thursday and Rs220 million on Friday. On Sunday, PIA consumed its daily limit of fuel and was unable to pay for more. PIA had paid Rs220 million to PSO on Friday for its operation over one and a half days, but this was not enough to cover its fuel costs for Sunday. PIA operated four flights from Karachi, Lahore, Islamabad and Multan airports to Jeddah and Riyadh, taking fuel worth Rs80-90 million.
This raised the total number of PIA flights taking off for different destinations on Sunday to nine. PIA's flight operations were partially restored on Sunday evening after five flights were operated from different cities of the country.
PIA is taking necessary measures in the wake of the current financial crisis and is in contact with PSO and the aviation ministry to normalise air operations.
