Days after he led a government delegation to Moscow to clinch the arrangement, Pakistan’s state minister for petroleum claimed that Russia will sell crude oil to his country at a reduced price.
Musadik Malik announced at a news conference in Islamabad that Russia will also provide Pakistan with subsidized gasoline and fuel.
He omitted to explain how much the reduced Russian oil would cost or whether the imports would be in compliance with a $60 per barrel restriction on Russian seaborne oil established this week by the G7 countries and the EU in response to Russia’s invasion of Ukraine.
Moscow has declared that it will not sell to nations that adhere to the cap.
Regarding a discount for Pakistan, the energy ministry of Russia was silent right away.
He added that Islamabad was already in discussions with Russian private enterprises for the import of LNG. “Their government has also invited Pakistan to initiate talks on long-term contracts to buy liquefied natural gas (LNG)”.
Because spot prices continue to be out of Pakistan’s price range and shipments under long-term agreements continue to be insufficient to meet expanding demand, Pakistan has been unable to purchase LNG from the global market.
The nation has started rationing supplies to residential and business customers due to declining local gas reserves.
Additionally, local media has stated that oil supplies are still precarious because it is difficult to pay for imports.
The major component of Pakistan’s import bill is made up of energy and oil.
The South Asian economy has been experiencing a balance of payments crisis as a result of extremely low foreign reserves as of Nov. 25—only $7.5 billion, or just enough for a little over a month’s worth of imports—and a growing current account deficit.
Long-term efforts to build a gas pipeline between Moscow and Islamabad have met with little result.
Prime Minister Shehbaz Sharif and U.S. Ambassador Donald Blome jointly inaugurated a U.S.-funded project to renovate and boost power generation capacity at the Mangla hydropower plant as part of efforts to diversify energy output toward renewables to reduce import costs.
The $150 million project would increase the plant’s capacity by 300 megawatts, which will be sufficient to power 100,000 homes and 2 million people in Pakistan, according to a statement from the U.S. embassy in Islamabad.
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