Pakistan is currently seeking a 30–40 percent discount on crude oil from Russia, with the latter reportedly unwilling to offer its crude inventory at such cheap rates.
Moscow has refused to lower the price of crude oil for Pakistan by 30 to 40 percent, citing the fact that volumes had already been reserved to manage a stock of payments from other purchasers in the market.
Visit of Moscow
A delegation comprising Dr. Musadik Malik, Minister of State (Petroleum Division), Capt. (R) Muhammad Mahmood, Additional Secretary In-Charge (Petroleum Division), and other senior government officials arrived in Moscow this week to get a deal done on the import of discounted fuel.
So far, the talks haven’t yielded much clarity for both parties. But the Russian side has offered assurances to the Pakistani side and will share its responses later via diplomatic channels.
Low priced Russian oil
It bears mentioning that Russian oil is cheaper than global oil prices and can be sorted in Pakistani refineries. One private refinery has already previously used Russian crude oil to produce finished products.
Pakistan stream gas pipeline
The Russian side also requested that Pakistan first honour its commitment to the Pakistan Stream Gas Pipeline (PSGP) project. The project model under the GTG arrangement has already been finalized with few clauses of the shareholding agreement pending completion.
No long-term plans
Pakistan currently has no long-term plans for reducing fuel shortages. The market’s spare supply is swiftly running out due to increasing demand from other nations.
Importance of Agreement for Pakistan
Any agreement will enable the South Asian country to save billions of dollars if energy projects with Russia are put into action. Moreover, buying petroleum goods from Moscow would ease strain on the government’s foreign exchange reserves.
