Despite the Pakistani government’s high hopes, the importation of Russian oil will not significantly lower petroleum prices in the country. Reports suggest that Pakistan will only benefit from Russian crude oil to the extent of $7-8 million per 100,000 tonnes, which translates to a mere reduction of Rs. 1.30 per litre for the end consumer.
Economist Abdul Rehman reveals that the prospects of cost reductions from cheap Russian oil have been shattered due to unexpectedly high furnace oil output, reaching 60% compared to the estimated 40-50%. To effectively capitalize on Russian crude, Pakistan requires the establishment of a deep conversion refinery, a project that would take a minimum of 4-5 years to complete.
Karachi witnesses the arrival of the first Russian cargo ship carrying oil on June 13, marking a significant milestone. The vessel, measuring 183 meters in length and carrying 45,142 metric tons of Russian oil, docked at the port. However, the benefits for end users fall short of the government’s expectations, even with the processing of Russian crude oil by PRL.
