Pakistan Russian crude shipment paid in Chinese currency: minister

Pakistan paid for its first government-to-government import of Russian crude in Chinese currency, State Minister for Petroleum Musadik Malik said on Monday — a significant shift in its US dollar-dominated export payments policy.

The first cargo of discounted Russian crude oil arranged under a new deal struck between Islamabad and Moscow arrived in Karachi on Sunday. It is currently being offloaded at the port.

Malik, talking to Reuters by phone, did not disclose the commercial details of the deal, including pricing or the discount that Pakistan received, but said the payment was made in Chinese currency.

He said the purchase, Pakistan’s first government-to-government (G2G) deal with Russia, consisted of 100,000 tonnes, of which 45,000 tonnes had docked at Karachi port and the rest was on its way. The purchase was made back in April.

Malik played down concerns around the financial viability and concerns about the ability of local refineries to process Russian crude given the South Asian country’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.”

“No adjustments (were) needed at the refinery to refine the Russian crude,” the minister told Reuters.