Pakistan open to importing cheap oil from Russia

Amid a financial crunch, rising inflation and deepening economic crisis, Pakistan is mulling oil imports from Russia.

The country's Ministry of Energy has asked industrial experts to provide analysis for importing oil from Russia, as the country seeks to procure the commodity at a cheaper rate, reported Geo News.

While the United States has set out with allies to punish Russian President Vladimir Putin for the war on Ukraine by sanctioning a raft of Russian companies and oligarchs and adding others to a trade blacklist, Pakistan is mulling importing Russian oil.

Pakistan's monthly fuel oil imports are set to hit a four-year high in June. The country's fuel oil imports could climb to about 700,000 tonnes this month, after hitting 630,000 tonnes in May, according to Refinitiv estimates. Imports last peaked at 680,000 tonnes in May 2018 and 741,000 tonnes in June 2017.

In a letter written to the managing directors of Pak-Arab Refinery, National Refinery, Pakistan Refinery, and Byco Petroleum, the Energy Ministry directed them to submit the following analysis - Technical sustainability of crude grades in view of each refinery configuration and yield (Vol per cent); Quantity and grade of the subject crude to be required by the refinery, and Transportation/freight analysis for imports from Russia in comparison with normal imports from the Middle East based on cost and benefit analysis, reported Geo News.

Speaking during Geo News' programme "Aaj Shahzeb Khanzada Kay Sath" a day ago, Minister of the State for Petroleum Musadik Malik had said that Pakistan was "open to the idea of importing cheap oil from Russia".

He said that the Imran Khan's PTI-led government had made claim in this regard, but there were no official agreements between the two states regarding the import of cheap oil, however, a letter was sent to Russia by the previous government.

"Since coming to power, the coalition government has tried following up on the letter but has so far received no response from Russia," he said.

The state minister added that if Russia was willing to sell oil to Pakistan at cheaper rates, the government would definitely consider the option but would "ensure striking deals which would not result in any types of international sanctions on Pakistan."

On the other hand, Finance Minister Miftah Ismail had earlier this month said that Western sanctions have made importing oil from Moscow impossible despite the Pakistani government's request to buy wheat from Russia and Ukraine.

Miftah had also stated that Pakistan would surely consider if Russia offers oil trade at cheaper rates as there are no restrictions on buying the supply, reported Geo News.

Meanwhile, the US on Tuesday (local time) blacklisted 36 companies, including those from China and Pakistan, for supporting Russia in the Ukraine conflict.

US President Joe Biden's administration has added five companies in China to a trade blacklist for supporting Russia's military and defense industrial base.

The agency also added another 31 entities to the blacklist from countries that include Russia, UAE, Lithuania, Pakistan, Singapore, the United Kingdom, Uzbekistan and Vietnam, according to the Federal Register entry. Of the 36 total companies added, 25 had China-based operations, reported Al Jazeera.