In a strategic move aimed at modifying the energy crisis, Pakistan’s interim government is reportedly considering a substantial long-term deal to import up to 1 million tons of Russian oil annually. This decision comes as Moscow’s oil exports face restrictions in European markets due to Russia’s attack on Ukraine.
The interim energy minister, Mohammad Ali, revealed that discussions are underway to secure a robust, multi-year agreement for importing Russian crude oil. Such a deal could significantly bolster Pakistan’s energy security and help address the nation’s energy challenges. The report was initially conveyed by the TASS news agency.
This development follows Pakistan’s recent initiation of oil purchases from Russia at discounted rates, as the European markets remain closed to Moscow’s exports. The first shipment from Russia arrived in June, and negotiations are currently ongoing for the second cargo. Notably, Cnergyico, a private-sector entity, made history by procuring Pakistan’s first consignment of Russian crude oil just last week.
In addition to these critical energy decisions, Pakistan has been grappling with a host of economic challenges, including rising inflation and foreign exchange issues. Furthermore, the aftermath of Russia’s invasion of Ukraine last year led to skyrocketing prices for liquefied natural gas (LNG), posing a significant challenge for Pakistan.
To address the pressing issue of LNG shortages, Pakistan LNG Limited (PLL) recently awarded a tender to Vitol, a multinational energy and commodity trading company. Vitol is tasked with delivering an LNG cargo to Pakistan in December, marking the country’s first LNG purchase since the previous year.
As Pakistan navigates these complex energy and economic challenges, the prospect of a long-term Russian oil deal could offer a ray of hope for the nation’s energy stability, demonstrating the interim government’s commitment to ensuring a reliable energy supply for its citizens.
