Cheap Oil Import Deal to be Discussed Between Pakistan and Russia This Week
Cheap Oil Import Deal to be Discussed Between Pakistan and Russia This Week. Pakistan along with Russia are scheduled to start talks on the import of oil and liquified natural gas (LNG) in the coming week.
A Pakistani delegation consisting of Dr. Musadik Malik, Minister of State (Petroleum Division), and Captain (R) Muhammad Mahmood, Additional Secretary in-charge (Petroleum Division) along with other senior government officials will leave for Moscow for a three-day trip today to reach a settlement made on the import of discounted fuel, modes of payment and shipping cost as well as other issues. Apart from fuel imports, both parties are scheduled to discuss other aspects that are not restricted by those of the Pakistan Stream Gas Pipeline (PSGP) and a pipeline for gas that would connect Russia to Pakistan via Kazakhstan. In case you aren’t aware, Russian oil is cheaper than the global price of oil and is able to be processed through Pakistani refineries. One private refinery has already employed Russian crude oil for the production of final products.
It is important to note that Russian ships are barred in the past by Western allies from shipping fuel to other countries due to Russia’s conflict with Ukraine. At present, traders buy Russian oil and then sell it to countries that buy at a higher cost. This is why the cost of Russian goods rises because of trader fees as well as shipping costs.
Keep this in mind If Pakistan decides to purchase Russian petroleum, the most important problem will be the method of payment. Russia gets rubles from buyers’ countries, and the rules are tied to gold. Once the payment method is established, and if the price of Russian petroleum in Pakistan is reasonable local refineries will be able to begin imports of Russian oil. The whole thing depends on the cost, method of payment, as well as shipping costs that Pakistan’s government delegation negotiates in conjunction with Russian authorities. Cheap Oil Import Deal to be Discussed Between Pakistan and Russia This Week. While Pakistan starts talks with Russia however, it’s evident it is a South Asian nation that currently has no long-term LNG provider and its supply of LNG in this market has been rapidly declining due to the increasing demands from Europe. In this regard, the agreement can help Pakistan’s South Asian nation save billions of dollars in energy costs if projects that are partnered with Russia are put into place. Buying petrol products and other petroleum items from Moscow will ease pressure on the country’s reserves of foreign currency.