Daily Times

Against all odds, the first-ever shipment of Russian crude oil has arrived in Karachi, offering much-needed relief to Pakistan at a time when we are steeped in a devastating balance of payments crisis that has pushed us to the precipice of debt default. Pakistan’s purchase also gives Russia a whole new market for its product, adding to Moscow’s growing sales from India and China as it redirects oil from Western markets after it invades Ukraine. At this point, any fuel is good fuel for Pakistan, especially considering our usual partners have raised prices exponentially to cater to more lucrative European markets.

Like Pakistan, many other countries are finally prioritising their national interests over their desire to appease Washington, ensuring that they are able to protect the benefits that they derive from their relationship with Moscow. Since energy imports account for the majority of Pakistan’s external payments, cheap oil from Russia is a welcome development in an otherwise hopeless situation. Islamabad and Moscow have both remained coyly tight-lipped about the financial specificities of the agreement but it is speculated that the price per barrel hovers over some $60, in adherence with the cap set by G-7 countries for Russian oil.

Now that the deal is nearing its final stages, its only fair that we demand a little more transparency from our policymakers. For instance, if we’re buying unrefined oil, is our machinery even equipped to refine Russian oil which tends to be harsher than the sweet Middle Eastern blends we have grown accustomed to, especially since it’s crude? Equally concerning is that it is significantly cheaper to import oil from Saudi Arabia and Qatar compared to Russia. That combined with the fact that we have no currency swap arrangements in place with Russia means that it will be difficult to settle payments now that the first shipment has arrived. Islamabad’s partnership with Moscow has been cloaked in secrecy for so long that even with the arrival of this first shipment, the technicalities remain largely obscured. If this is going to be a long-term arrangement, it might be best to get the nitty-gritty details out in the open now. *