The Petroleum Division delivered some important results during a briefing given to the acting Prime Minister, Anwaar-ul-Haq Kakar, on the possible effects of using Russian crude oil on petroleum (POL) prices in Pakistan. The benefits of using Russian crude oil were discovered to be rather minor, with a projected decrease of just Re1 per liter for both gasoline and diesel.
The Petroleum Division emphasized two major difficulties with buying Russian crude oil. First, a lengthy transportation period of 30 to 36 days is necessary for the oil to get to Pakistan. Second, a quarter of the output from refining Russian crude is furnace oil, which must be exported at a price equal to 75 percent of the value of the crude, resulting in a 25 percent loss.
It’s important to note that only Pakistan Refinery Limited (PRL) has declared a desire to refine Russian oil. Consumers can expect only a Rs. 1 decrease in the cost of gasoline and diesel per liter if PRL remains the only refinery involved in this procedure.
However, depending on the amount of Russian crude imported, the potential advantage might rise to Rs 3 per liter if PARCO and NRL (National Refinery Limited) collaborate to refine Russian oil. This confidence is based on the belief that PARCO’s more advanced facilities will increase the yield of Russian crude and, to some extent, diminish the production of furnace oil. But neither PARCO nor NRL want to be in charge of processing Russian oil.
In addition, it’s significant to remember that Russia has reduced the discount on Platt pricing for its crude oil, bringing it down from the prior range of $15 to $20 per barrel to $5 per barrel. Furthermore, the price of Russian oil has gone above the $60 per barrel G7-set ceiling, which may cause payment problems if imported above this price limit.
In spite of being an older refinery, Pakistan Refinery Limited (PRL) tried processing heavy Russian crude (URAL) for around three months. During this test period, they employed a strategy that included a blend of 45% URAL, 45% Middle Eastern crude, and 10% local crude.