ISLAMABAD: State Minister for Petroleum Dr. Musadik Malik on Wednesday said Pakistan would receive the first consignment of Russian oil within the first half of June, hoping the import of oil at cheaper rates would make a “difference in the market.”
The country placed its first order for Russian crude oil on April 20 after the two sides signed several memoranda of understanding in the preceding weeks. Malik said Pakistan would assess how much oil to import in the future after receiving the first shipment.
“The first cargo containing 100,000 tons of oil from Russia will reach Oman on May 27 or 28, and from there, it will be transported to Pakistan via small ships,” he said in a news conference on Wednesday.
“The Russian oil will reach Pakistan by the end of the first week or at the beginning of the second in June,” he continued, adding the import of cheap oil would make a “difference in the market.”
Pakistan’s energy procurements from the international market constitute the most significant portion of its import bill, putting immense pressure on its forex reserves which have plummeted to critically low levels over the last several months.
According to official figures, the amount stood at about $23 billion during the last fiscal year.
Asked if the government’s plan to provide cheaper oil to the public would lead to potential objections from the International Monetary Fund (IMF) which is yet to release a $1.1 billion tranche under a stalled bailout facility, Malik said he was “confident” the global money lender would not raise any issues.
Islamabad has faced procurement problems related to liquefied natural gas (LNG) from the global market due to erratic spot prices that largely remained out of its reach since the Russian invasion of Ukraine.
Local media reports maintain Pakistan’s oil supplies have remained tenuous due to issues pertaining to clearance of import payments.
Historically, Pakistan has not enjoyed strong commercial relations with Moscow, unlike neighboring India, and has remained a traditional US ally. More recently, however, the South Asian state has started giving greater importance to economic diplomacy to augment its options in the international arena.