Business & Economy

Pakistan receives first shipment of discounted Russian oil

Islamabad, Jun 12 (EFE).- The first shipment of Russian crude oil supplied at discounted rates has arrived in Pakistan despite international sanctions against Moscow, Islamabad announced on Monday, amid Pakistan’s attempts to ease the effects of its ongoing economic crisis.

“A ship carrying crude oil from Russia at a discounted price has reached Karachi,” tweeted Marriyum Aurangzeb, a Pakistani government spokesperson.

Prime Minister Shehbaz Sharif said that authorities would begin to unload the crude oil from the tanker on Monday, thus adding Pakistan to the list of countries – including neighboring India – that have benefitted from the discounts being offered by Moscow on fossil fuel to overcome sanctions imposed against it since the beginning of the Ukraine war.

Although Sharif did not specify the size of the first oil shipment, the government had announced last month that a tanker carrying 100,000 tons of crude had reached Oman, from where smaller ships were set to bring the fuel to Pakistan.

The first shipment carried 45,000 tons of crude, while a second load of 50,000 tons is set to arrive at the Karachi port next week, according to state broadcaster Radio Pakistan.

The lack of facilities and limited port capacity in Pakistan makes the docking of ships carrying more than 50,000 tons impossible.

Although the exact value of the deal is not known, Pakistani authorities announced that the imports could reach up to 100,000 barrels per day if the first transaction is successful.

The imported crude will be refined in Pakistan and provide a major relief to Islamabad, which has been hit hard by the rising costs of natural gas and petroleum, especially after the devastating floods in summer 2022, which affected 33 million people and displaced 8 million. Over 1,700 people were killed in the natural calamity.

Pakistan is currently undergoing a severe economic crisis, with its foreign currency reserve at a historic low and inflation rising to 38 percent in May, marking the highest rate in the country’s history.

In this regard, Islamabad is negotiation the release of $1.1 billion with the International Monetary Fund as part of a bailout package worth $6 billion signed in 2019. The amount was raised by another $1 billion after the massive floods.

The IMF board is set to take a decision on resuming the bailout program through this month, as the deadline for Pakistan being able to access the next tranche of the package expires on Jun. 30. EFE


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