Given that Pakistan’s refining industry cannot handle crude oil of a single specification, Russia has offered to supply Pakistan with blended crude oil.
The Russian offer was made on Thursday during a virtual meeting between officials from both countries. A national daily reported that senior representatives from the energy ministry and other departments, as well as the Pakistani state minister for petroleum, Dr. Musadik Malik, led the negotiations with the Russian cohort.
Sources with knowledge of the situation claim that Pakistani officials informed their Russian counterparts that their nation needed gas, petroleum products, crude oil, and external financing for infrastructure development. The Russian side informed the Pakistani authorities that they were prepared to work together and would talk more about it when a delegation from Moscow visits Pakistan next month.
Russia was also said to be willing to supply Pakistan with 100,000 barrels of crude oil on a daily basis. However, the Pakistani authorities informed them that the refineries in their nation processed light crude oil using hydro-skimming technology. For effective processing, they also mentioned that light crude oil would be preferred.
If Pakistani refineries are unable to process one crude oil, the Russian authorities said they can supply a blended crude alternative. More discussions are planned for the Pakistan-Russia Inter-Governmental Commission (IGC) meeting in the second week of January 2023.
It is no secret that Pakistan is in talks with Russia about providing a “crude bailout,” but the South Asian country currently has no long-term plans for reducing fuel shortages, and the market’s spare supply is rapidly running out due to rising demand from other nations.
With that in mind, any agreement will enable the South Asian country to save billions of dollars if energy projects with Russia are put into action, while buying petroleum products from Moscow would ease pressure on the country’s foreign exchange reserves.
