Keeping in view the ongoing economic crisis and acute fuel shortage, the government mulls over importing cheap Russian oil. In this regard, the Ministry of Energy has asked the industrial experts to provide an analysis for importing oil from Russia.
Ministry of Energy directs industrialists to submit the analysis
The Minister of Energy, Musadik Malik has said that Pakistan is open to the idea of importing cheap oil from Russia, and for that, they have asked the managing directors of Pak-Arab Refinery, National Refinery, Pakistan Refinery, and Byco Petroleum to submit the following analysis:
• Technical sustainability of crude grades in view of each refinery configuration and yield (Vol%).
• The quantity and grade of the subject crude to be required by the refinery.
• Transportation/freight analysis for imports from Russia in comparison with normal imports from the Middle East based on cost and benefit analysis.
• Payment method
• Existing commitment to upliftment from the Arab Gulf region with respect to term contracts.
According to the minister of energy, if Russia is willing to sell oil to Pakistan at cheaper rates, the government would definitely consider the option but at the same time, it will also ensure to strike deals that would not result in any types of international sanctions on Pakistan. The Finance minister, Miftah Ismail, also mentioned that Western sanctions have made importing oil from Moscow impossible
Why Pakistan should start thinking about importing cheap Russian oil
According to Refinitiv, a global data analysis firm, Pakistan’s monthly fuel oil imports has hit four-year high in June. Moreover, the country’s fuel oil imports could climb to about 700,000 tonnes this month, after hitting 630,000 tonnes in May. In comparison, the imports last peaked at 680,000 tonnes in May 2018 and 741,000 tonnes in June 2017.