Significant progress has been made in securing a cost-effective oil supply from Russia, as Pakistan has recently entered a long-term oil procurement agreement with Moscow. Under this arrangement, local refineries will directly source oil from Russia, with deliveries to occur at a Pakistani port.
The agreed-upon price for this oil is set at $60 per barrel, and the first shipment, consisting of 100,000 metric tonnes of crude oil, is scheduled for arrival in Pakistan this coming December.
Moreover, government-level negotiations are anticipated to follow as regular supplies commence. Notably, this commercial agreement takes into account the G7 price ceiling for Russian oil, which is impressively $10 per barrel cheaper than prevailing market rates, even after accounting for the removal of the rent premium. In fact, Pakistan’s initial trial cargo has already resulted in savings of $400 million.
