Impact of imported Russian oil on fuel prices to take time: Musadik Malik

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A screenshot of Minister of State for Petroleum Musadik Malik from a video message played at  Pakistan Energy Conference 2023 on Tuesday. Screengrab via
Petroleum Institute of Pakistan YouTube
A screenshot of Minister of State for Petroleum Musadik Malik from a video message played at Pakistan Energy Conference 2023 on Tuesday. Screengrab via Petroleum Institute of Pakistan YouTube

Minister of State for Petroleum Musadik Malik said on Tuesday that the import of cheap oil from Russia would not result in an immediate decrease in fuel prices, but a gradual decline would be seen once the oil supply from Moscow becomes continuous.

In a pre-recorded video message played at the Pakistan Energy Conference 2023, the minister said: “Importing oil from Russia is not a [mere] promise. It’s not just talk. The ships have reached Oman and the supply of cheap Russian oil to Pakistan will begin in a week.”

However, he continued, one ship of oil wouldn’t make a difference on the fuel cost. “But once the supply becomes persistent, the fuel cost will gradually decrease.”

The minister said the government’s target was to use cheap oil, including from Russia, to fulfil one-third of the country’s crude requirements.

Malik made these remarks while elaborating on the government’s plan to ensure the supply of sufficient energy in the country in a sustainable manner and at an affordable price.

Pakistan, the world’s fifth most populous country, faces chronic energy shortages and imports 84 per cent of its petroleum products, overwhelmingly from Gulf Arab allies Saudi Arabia and the United Arab Emirates.

Import of cheap Russian oil is one of the avenues that Pakistan has been pursuing to mitigate its energy crisis amid global efforts to choke off Russia’s oil exports that help fund its invasion of Ukraine.

Earlier this month in the US — which has been leading the global efforts to curb Russian exports — Malik confirmed that a first order was placed for Russian oil and would arrive within a month in Pakistan, which will then assess how much to import in the future.

Asked if Pakistan will pursue more Russian imports, he said, “If today we get cheaper sources of energy, we’ll go there.”

Along similar lines, he said in his video message that government’s objective was to ensure the supply of low-cost energy in a sustainable manner.

“Accessibility, sustainability and affordability — these are our three objectives,” he said.

While elaborating on this vision, he mentioned, among other things, the Iran-Pakistan Gas Pipeline project as a means to fulfil the country’s energy needs.

“We have conveyed to Iran that we want to access energy via the Iran-Pakistan Gas Pipeline but in a responsible manner and so that we don’t face any sanctions. We will find out a creative way to figure this out and are holding talks with those who have [imposed] sanctions and Iran.”

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