Pakistan should forget buying Russian oil for the time being

I am an ardent supporter of buying Russian oil being sold at huge discount. However, on the second thought, without mincing my words, I would say Pakistan should forget buying Russian oil for the time being. The country must solicit better terms and conditions from countries currently meeting Pakistan’s requirements.

First and the foremost, Pakistani refineries are not tuned to refine Russian oil. Even if Pakistan decides to buy Russian oil, the prerequisite is making these refineries capable of refining Russian oil. At this juncture, Pakistan neither has the foreign exchange nor the time to re-tune the refineries.

Second making payment to Russian suppliers is a stumbling block. Even those European countries, heavily dependent on Russian oil and gas, are being pressurized by United States to gradually curtail their purchases of energy products from Russia. The payment process is also being made difficult. On top of all, Pakistan also does not have ample rubles.

Third, Pakistan already enjoys deferred payment facility from Saudi Arabia. The kingdom is also willing to give more foreign exchange, but it would certainly not approve taking money from it and buying oil from Russia.

Pakistan can also increase purchase of motor gasoline and diesel purchase from these two brotherly countries to avoid any retuning of the refineries in Pakistan.

UAE is already a joint venture partner in Pakistan’s largest refinery, Pak-Arab Refinery (PARCO) located at Mahmood Kot near Multan and black and white oil pipelines in Pakistan.

Forth, the sailing time from Saudi Arabia/United Arab Emirates to Pakistan is certainly shorter as compared to any of the Russian ports. Therefore, the benefit of discounted price would be eroded to a significant extent by higher freight cost.

Along with buying crude oil and POL products from Saudi Arabia and UAE, Pakistan should also negotiate with Qatar to sell LNG at concessional price that too at a deferred payment.

On the diplomatic front Pakistan should also convince United States to let the country buy LNG from Iran. The argument is simple, “If India being a member of QUAD can buy oil from Russia despite sanctions; Pakistan should also be allowed to buy gas from Iran”.     

As such the negotiations regarding ‘Iran Nuclear Deal’ has been dragged for too long. If United States is willing to allow Venezuela to export oil, sanctions on Iran should also be withdrawn immediately to save the world from crude oil and energy products becoming too expensive.

This is also to remind the policy makers that Iranian President Ebrahim Raisi has already assured Pakistan’s Foreign Minister Bilawal Bhutto Zardari the willingness of his country to meet Pakistan’s demand of oil, gas and electricity.