PSO controls 70% of Pakistan's oil market

The war in Iraq has delayed this month's flagship privatisation of Pakistan State Oil (PSO) due later this month.

The Privatisation Commission said bidding for PSO, which was due on 26 April, had been postponed at the request of interested buyers.

Pakistan's decade-old privatisation program has been repeatedly pushed off track, most recently by the US-led war in Afghanistan, hostilities with India and sanctions over nuclear tests in 1998.

About $1.9bn (�1.21bn) has been raised so far, which has not been sufficient to retire substantial parts of Pakistan's $36bn in debts.

Co-operating with the US's wars has resulted in $12.5bn of debt rescheduling and a waiver on $1bn in US loans.

New deadline

"The prospective bidders have approached (the) Privatisation Commission for postponing the bidding date citing the recent Iraq war and their internal approval procedures as reasons for the request," the commission said in a statement.

"A new date of bidding would be announced shortly after discussion with prospective investors," it added.

Two Middle Eastern groups, the Kuwait Petroleum Company and Midrock of Saudi Arabia, plus Pakistan's Fauji Foundation are the main interested parties.

The government controls about 51.8% of PSO and the rest of its shares are listed, but most are held by state-run institutions.

PSO controls 70% of Pakistan's petroleum market.