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Pakistan

Russia to provide crude oil to Pakistan at discounted rates: Musadik Malik

  • State minister for petroleum says Russian government-level delegation will visit Pakistan in mid-January
Published December 5, 2022

State Minister for Petroleum Musadik Malik said on Monday that Russia has agreed to provide crude oil at discounted prices, a development that could potentially bring down the energy import cost for Pakistan.

Speaking at a press conference, he stated that Russia will supply petrol and diesel to Pakistan at the maximum possible discount.

Expensive fuel is one of Pakistan's top issues with a cash-strapped economy hard-pressed to finance its growing energy needs.

Speaking about the potential import of liquified natural gas (LNG), Malik said stocks with Russian firms are low because countries, which pledged to go green, purchased the fuel at costly prices.

“We approached a few private Russian firms for LNG but the government urged us to ink deals for 2025-26,” he said.

"Acting in the best interest of Pakistan, the government approached Russia to resolve fuel woes. We will solve the energy problem. We will begin talks with government-owned companies of Russia soon,” he said.

The minister underlined that Pakistan also discussed pipeline connections with Russia and set a few deadlines.

Malik also announced that “a government-level delegation of Russia will visit Pakistan in mid-January 2023 and we intend to move forward with multiple deals.”

Referring to the shortage of gas for residential and commercial consumers in the ongoing winter season, Malik stressed that despite depletion of indigenous gas, the supply of fuel to customers was higher than last year.

“We are ensuring supply of gas to residential consumers during meal timings,” Malik added.

Linking the progress of the country with energy generation, he stated for every 1 percentage point increase in Pakistan's economic growth, energy needs rise by 1-1.5%.

“For 5-6% growth rate, our energy needs grow by 9-10%,” he said.

The minister's presser comes after a delegation from Pakistan, led by Malik, left for Russia on November 28 to negotiate a potential oil deal with Moscow.

Last month, Federal Minister for Finance Ishaq Dar had said that during his visit to the US in October, he met officials and took up the issue of oil purchase from Russia.

He said back then, he told the American authorities that Washington could not stop Pakistan from buying the commodity from Russia because neighbouring India has also been doing the same.

Purchase of Russian crude at cheaper rates has become a hot topic in recent months as prices of energy commodities increase significantly. This has been painful especially for developing economies like Pakistan, which rely heavily on petroleum imports to meet their energy needs.

As per data provided by the State Bank of Pakistan (SBP), Pakistan imported petroleum products worth $7.547 billion during the first four months of the ongoing fiscal year.

Comments

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Moeen Dec 05, 2022 05:07pm
Badly needed actions to reduce the cost which can only save the PMLn politics and ease of life
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Abdul Sheikh Dec 05, 2022 08:57pm
Iranian oil is cheaper than Russian.
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