Pakistan paid for its first government-to-government (G2G) import of discounted Russian crude in Chinese currency, the petroleum minister said on Monday, a significant shift in its US dollar-dominated export payments policy.

Discounted crude offers respite as Pakistan faces an acute balance of payments crisis, risking a default on its debt obligations.

The first cargo of discounted Russian crude oil arranged under a new deal struck between Islamabad and Moscow earlier this year arrived in Karachi on Sunday.

Petroleum Minister Musadik Malik, on Monday, played down concerns around the financial viability and concerns about the ability of local refineries to process Russian crude given Pakistan’s historical importation of Middle Eastern petroleum products. “We’ve run iterations of various product mixes, and in no scenario will the refining of this crude make a loss,” Malik said, adding, “We are very sure it will be commercially viable.”

Published in The Express Tribune, June 13^th, 2023.

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