Cnergyico, a Pakistani refiner, has imported the country’s first private-sector shipment of crude oil from Russia. This is possible because Russia has discounted its oil exports after being banned from European markets due to its invasion of Ukraine. The first cargo was imported by the government in June, and a second shipment is currently being negotiated. Private imports were initially thought to be unfeasible because Pakistan’s ports cannot handle large tankers, but Cnergyico used its single point mooring to accommodate deep-draft tankers. The imported crude will be refined at Cnergyico’s refinery in Hub. The company plans to sell gasoline and diesel locally and export furnace oil. Cnergyico is the largest refinery in Pakistan and has its own single-point mooring. The company conducted due diligence to ensure the import did not violate sanctions. Pakistan aims to import 100,000 barrels per day (bpd) of oil from Russia to address a foreign exchange crisis and manage inflation. Last year, Pakistan’s total crude imports were 154,000 bpd. The government paid in Chinese yuan for its first import, and Cnergyico is expected to pay in yuan as well. The benefits of Russian discounts are being undermined by increased shipping costs and lower-quality fuels produced from the imported crude. Cnergyico plans to make the Russian imports viable by exporting furnace oil and generating foreign exchange.
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