Wed, 31 May 2023

ISLAMABAD, Pakistan - Following months of negotiations, Pakistan placed its first order for discounted Russian crude oil under a new agreement between Islamabad and Moscow.

Musadik Malik, State Minister for Petroleum, confirmed the news, saying that one cargo will arrive at Karachi port at the end of May.

"The agreement calls for Pakistan to buy only crude oil, not refined oil, and imports are expected to reach 100,000 barrels per day if the first transaction goes smoothly," Malik told Reuters on Wednesday night.

"Our orders are in; we've already placed them," he said.

He stated that the Russian crude would be initially refined by Pakistan's Refinery Limited (PRL), with other refineries joining after a trial run.

A Russian delegation arrived in Pakistan earlier in April to discuss the payment mode.

"Russians raised the issue during the talks about the media reporting of the talks, particularly about the discount in crude oil price and mode of payment, stressing the Pakistani counterparts ensure keeping the deal with Moscow secret as they do not want the disclosure to other Russian crude buyer countries," sources familiar with the matter told the press.

As a result, Pakistan's top officials decided not to reveal the mode of payment or the exact discount.

In January, Russian Energy Minister Nikolay Shulginov led a delegation to Islamabad to negotiate the deal, after which he stated that oil exports to Pakistan could begin in March.

However, things were pushed back as the two parties struggled to agree on the deal's payment mode and other aspects.

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