Bargain Islamabad: Pakistan switches to Russian oil

Bargains attract Islamabad
Pakistan switches to Russian oil

European countries are distancing themselves from Russia as a customer for energy exports due to economic sanctions. Pakistan, on the other hand, is turning to the Kremlin. High inflation means Islamabad has to look for cheaper oil, which Moscow currently has in stock.

In the near future, Pakistan wants to meet one-third of its energy needs with Russian oil. This was stated by Pakistan’s Energy Minister Musadik Malik. According to negotiations between Moscow and Islamabad, the supply of Russian oil at low prices will start in early March. Malik did not provide any information on pricing or the exact volume of planned imports. To date, Pakistan has mainly received oil from the United Arab Emirates, Saudi Arabia and Kuwait and liquefied natural gas from Qatar.

Irfan Schesad, an expert at the Eurasia Century Institute in Islamabad, spoke of a “win-win situation”. Gas shortages and high oil prices have recently driven up inflation in the country of 230 million people. Prime Minister Shahbaz Sharif announced last year that he wanted to find new ways to meet his country’s energy needs.

Moscow confirms deal to supply oil to Pakistan Russian Energy Minister Nikolai Shulkinov said the technical details should be clarified by the end of March. This applies to insurance, payment and transportation issues. In addition, Shulkinov suggested discussing the supply of liquefied natural gas (LNG) to Pakistan from the end of 2023.

The EU has allowed Kremlin oil since December

In December, the European Union imposed a price cap on Russian oil. Western industrialized countries, which control large parts of shipping companies, financial markets and ship insurance companies, have joined the regulation.

Since December, the European Union has banned Russian oil imports by sea because of its war of aggression against Ukraine. Germany and Poland drop oil from the “Druzhba” pipeline connecting Russia’s oil fields with Eastern and Central Europe.

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