ISLAMABAD: Russia has been disappointed by Pakistan’s slow progress in starting the process of importing crude oil.
Sources told that Russia had already expressed ‘skepticism’ over Pakistan’s move to import crude oil, so it had asked Pakistan to first import a cargo of crude oil that Pakistan was serious about. will indicate
Pakistan has agreed to import a cargo next month. However, in recent developments, Russia has been disappointed to learn that Pakistan has yet to take any steps to buy crude oil from Russia despite assurances. What did
Pakistan had promised Russia to set up a new Special Purpose Vehicle (SPV) company that would be responsible for importing Russian oil to Pakistani refineries. Not proceeding to register, much to Russia’s dismay, Pakistan had to register the company with the Securities Exchange Commission of Pakistan (SECP).
The Petroleum Minister had announced that the first batch of crude oil from Russia would arrive by the first week of April. However, due to the delay in setting up the SPV, sources said that the first batch is now expected to arrive in May this year. Crude oil price negotiations with Russia have been the most pressing issue.
The US had recently asked Pakistan to follow the G7 oil pricing mechanism for negotiating the price with Russia. I had many complications.
Sources said that Arabian crude produced more diesel and less furnace oil. But in case of Russian crude oil it was the opposite which would produce more furnace oil and less diesel. Hence lower diesel production from Russian crude. It will eliminate concessions offered on oil trade. Arab Oil produces 45 percent of High Speed Diesel (HSD) and 25 percent of furnace oil.
Sources further said that Russian crude oil will produce 32% high speed diesel and 50% furnace oil. If we take this ratio, Pakistan needs to get more discount from Russia, sources added that Pakistan needs such crude oil. It is required to produce more diesel oil.
Moscow has already offered to export 100,000 barrels of crude oil per day to Islamabad. As Pakistan faces a dollar shortage, it may be a challenge for the country to pay for Russian crude oil in the same currency. Earlier, a foreign company offered to import Russian crude oil to a Pakistani refinery, but Pakistani banks refused to pay.
Russia has now agreed to receive payment in three currencies for crude oil supply to Pakistan: Russian ruble, Chinese yen and UAE dirham.
Experts say that it will be a big relief for Pakistan if the country is able to sign an oil deal with Russia and make payments in currencies other than dollars.
