PAKISTAN LIKELY TO PAY DISCOUNTED RUSSIAN CRUDE IN CHINESE CURRENCY

Fri 05 May 2023:

Pakistan will most likely pay for the Russian oil in Chinese yuan, with the first cargo of 750,000 barrels of crude scheduled to arrive in June.

According to The News, quoting an official, Pakistan would most likely pay the price of crude in Chinese money, and the “Bank of China may play a role in transactions.”

However, the official refused to reveal in detail the mode of payment and the exact discount, arguing that it is not in the best interests of the country, and the seller also does not want to make it public for fear of consequences from other countries buying Russian oil directly from Moscow.

“Russia will provide URAL crude in the test cargo and most probably Pakistan Refinery Limited (PRL) will be tasked to refine the Russian crude,” he added.

Commercial analysis of Russian crude has been conducted in favour of Pakistan’s economy but it will further be cross-checked after refining the Russian oil.

The shipping cost of the Russian oil has also been estimated somewhere at $15 per barrel, but it will be finalised after it arrives at the Pakistan port.

Other sources told The News that Pakistan has settled on a per barrel price of $50-52, compared to the G7 maximum price of $60 per barrel.

Pakistani refineries have been importing 80% of crude under long-term agreements from ADNOC and Saudi Aramco, with a cushion to acquire Russian oil under a long-term deal to some extent.

However, the government would want to preserve some buffer for acquiring crude from the international market because the crude price can go below the cost signed under long-term agreements, according to The News.

SOURCE: INDEPENDENT PRESS AND NEWS AGENCIES

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