PIA - Pakistan International Airlines (PK, Islamabad International) continues to experience extreme difficulties maintaining its day-to-day operations, with 77 out of 81 scheduled flights cancelled on October 22 because its fuel supplier again cut off access.

Multiple Pakistani outlets report that PIA cancelled 52 international and 29 domestic flights after the state-owned Pakistan State Oil (PSO) suspended Jet A1 deliveries. Four international flights did manage to take off. The fuel supplier regularly stops supply to force the state-owned airline to the negotiating table and extract some payment of monies owed.

According to reports, late-night meetings between PIA and PSO on October 22 resulted in a promise by the airline to make daily payments of PKR100 million Pakistani rupees (USD359,000) to reduce its debt in exchange for PSO resuming a "restricted" supply of fuel. Consequently, PIA cancelled domestic and international 26 flights on October 23. Earlier this month, ch-aviation reported on threats by PSO to cut or restrict fuel supply after PIA ran up a debt of approximately PKR26 billion (USD93.3 million).

Amid the flight disruptions, Pakistan's caretaker prime minister, Anwaar-ul-Haq Kakar, renewed his calls to accelerate PIA's partial privatisation process. The flight disruptions also follow a PKR18 billion (USD64.6 million) loan made to PIA by two Pakistani financial institutions in mid-September. The airline purportedly used the money to bring payroll obligations up to date and stabilise flight operations.

However, in recent days, reports have also emerged of PIA going back to the banks to ask for a further PKR1.5 billion (USD5.4 million) in emergency funding to keep the airline flying. The airline has also reportedly written to the Ministry of Finance requesting another government guarantee to secure a further PKR7.5 billion loan (USD26.9 million). The current Pakistan government has previously told the airline it will no longer keep bailing it out, but financial institutions will only lend to it with some form of guarantee. Last month, ch-aviation reported that PIA was spending 48% of its revenues servicing its debts. ch-aviation has contacted PIA for comment.

Meanwhile, a seven-person delegation has made the trip to Kuala Lumpur to attempt to settle a long-running lease dispute with Asia Aviation Capital Limited (AACL), a wholly-owned subsidiary of Capital A, the entity behind AirAsia Aviation Group. The negotiations are about two out-of-lease A320-200s parked at Jakarta Soekarno-Hatta, which PIA would like to buy. However, in a case running in the UK's High Court, AACL says PIA owes it over USD31 million in unpaid basic rent, redelivery rent, maintenance reserves, and contractual interest from its previous lease of the aircraft.

However, the talks have progressed and if the parties can reach a settlement, a PIA spokesperson told ch-aviation that the airline remains keen to buy the planes. "The discussions are in conclusive stages," he said. "We would be interested in acquiring those aircraft for PIA Fleet and necessary funding is being planned for that."