The Petroleum Division has presented a comprehensive briefing to the caretaker Prime Minister, Anwaar ul Haq Kakar, regarding the potential impact of Russian crude oil on petroleum prices in Pakistan.
According to The News, the Petroleum Division highlighted that the projected benefit to consumers resulting from the import of Russian crude oil remains relatively modest, at approximately Re1 per litre for both petrol and diesel. This assessment takes into account various operational intricacies and market dynamics.
Importing Russian crude oil carries two notable risks, the division stated. The first pertains to the duration of transportation, which spans between 30 and 36 days, and the second revolves around the production of furnace oil.
Approximately 60 per cent of furnace oil generated from Russian crude must be exported, incurring a 25 per cent loss in the process.
It is significant to note that, currently, only the Pakistan Refinery Limited (PRL) has expressed readiness to refine Russian oil. However, if PRL assumes the responsibility of refining Russian oil exclusively, only a nominal Re1 relief can be passed on to consumers for each litre of gasoline and diesel.
In a potential collaborative effort, the prime minister was informed that if PARCO (Pak-Arab Refinery Company) and NRL (National Refinery Limited) jointly undertake the refining of Russian oil, the benefit to consumers could potentially increase to Rs3 per litre. The magnitude of this relief would be contingent on the volume of Russian crude involved in the process.
PARCO, as a comparatively modern refinery with superior facilities, is expected to contribute to enhanced yields from Russian crude and, consequently, a reduction in the production of furnace oil. However, it was also revealed that both PARCO and NRL have declined the proposition to refine Russian oil.
The caretaker Prime Minister, Anwaar ul Haq Kakar, has expressed the need for a thorough evaluation of the situation, considering the potential benefits, risks, and the willingness of refineries to participate in the process. The decision regarding the import and refining of Russian crude oil remains a pivotal concern as Pakistan navigates its energy landscape in the coming days.
This development emphasises the intricate balance between economic considerations and strategic decisions in the energy sector that Pakistan faces as it grapples with global oil market dynamics.
