THROUGH a tweet on Sunday, Prime Minister Shehbaz Sharif shared news that the first cargo of discounted crude oil from Russia has arrived in the country, describing it as a transformative day. He said we are moving one step at a time towards prosperity, economic growth, energy security and affordability.
Indeed this signifies a major milestone in the bilateral relationship between the two nations. We understand that this will not only enhance our energy security but also pave the way for deeper economic cooperation and strengthened geopolitical ties. Over the years both the countries have made concerted efforts to foster cooperation in various fields including defence, trade and energy. The arrival of discounted oil serves as a tangible outcome of these collaborative efforts, creating a strong foundation for future partnership. By diversifying its energy sources, Pakistan can unlock new opportunities for economic growth, improve industrial competitiveness and mitigate risks associated with global oil market fluctuations. This development underlines the importance of forging strategic partnerships and highlights the immense potential for collaboration between Pakistan and Russia in various sectors.
Having said so, it is also important to clearly calculate the impact of the discounted Russian oil. According to experts, our refineries are not accustomed to refining the hard Russian crude oil. Because of this Russian crude oil will produce fifty percent furnace oil and thirty two percent diesel as compared to the Arabian oil which produces forty five percent diesel and twenty five percent furnace. This detail is significant in the context of Pakistan’s oil consumption pattern. Diesel, used for transportation, makes up thirty nine percent, while furnace oil, used for power generation, makes up just fifteen percent. As a result, Pakistan will end up with more furnace oil than it needs. In this backdrop, we really need to upgrade our refineries with the cooperation of Russia in order to get more diesel from the discounted crude oil. At the same time, given our burgeoning energy-related exports which have become a burden on our economy, we have to shift to renewable energy sources mainly solar and wind to meet the growing requirements. We also need to pursue such policies that promote local oil and gas exploration.
