Kuwait urged to supply oil on deferred payment

As part of its campaign to get the financial support from friendly countries in kind or cash to contain the burgeoning fiscal deficit, Pakistan is now looking towards Kuwait to get oil against deferred payments. If it worked in Pakistan's favour, the move will give Pakistan a significant relief, albeit temporarily, in the shape of purchase of oil worth $ 1 billion on deferred payment in the current fiscal year.
Sources in Islamabad said the ministry of Petroleum and Natural Resources is working towards seeking oil from Kuwait, the second largest oil supplier to Pakistan, on a three-month credit. "We have made a request to Kuwait government to consider supply of oil to Pakistan against three months deferred payments and hope to get a positive response from it shortly," the officials said.
These sources say that Pakistan is working on different proposals and a request to Kuwait for supply of oil against deferred payment is in line with the same strategy. Pakistan had also made an identical request to Saudi Arabia but could not get the desired result. Now Kuwait is on the list for much-needed financial support.
Pakistan's oil consumption in previous year stood at 20 million tons, daily 400,000 barrels while local production meets only 13 percent of total demand. Last year, total oil import in different categories - crude oil 7 million tons, HSD 4.6 million tons, and furnace oil 6.6 million tons - that took the import bill to over 10 billion dollars.
For the current fiscal year, total consumption was estimated at 12 million tons (two million tons more than the last year's and at 70 dollars a barrel, Pakistan's oil import bill was projected close to 12 billion dollars. However, a sudden surge in oil prices, the situation has put Pakistan in a highly disadvantageous position.
Now the officials of the finance and petroleum ministry apprehend that if the oil prices in the global market remained at the current level of 100 dollars a barrel it could take yearly oil import bill beyond 13 billion dollars, a level hard for Pakistan to afford without foreign financial support.