Fall in the oil prices is win for some, loss for many. Energy importing nations are eager to get back to close to normal so derive full benefits. So are energy intensive businesses. However, the demand is much below the survival rate. Many business are going insolvent, laying employees and dying for good.
Pockets are new business are thriving which have adapted to changing consumer pattern and adapted technology to offer products/services at home. This is the new normal. An eventuality, fast-forwarded by Covid 19.
Pakistani businesses reliant on national grid wouldn’t enjoy as huge capacity payments wouldn’t let electricity costs get diluted. Industries with captive Furnace Oil are happy to fill their tanks – irrespective of carbon foot prints.
Interestingly, coal prices haven’t plunged much. The volatility is low and managed by China – largest producer and consumer. However, since oil has become relatively cheaper source of energy than Coal, expect some catching up by Coal and prices may hit $40-45/tone.
Nonetheless, see this as a short-term respite to fix power sector, document economy, diversify/increase exports, industrialize businesses, root out corruption & deleverage the economy.
