PBF Demands To Initiate Import Of Cheap Oil And Gas From Iran

PESHAWAR, (UrduPoint / Pakistan Point News - 7th Dec, 2022 ) :Senior Vice President (SVP) Pakistan Businesses Forum (PBF), Riaz Khattak has hailed the Federal government successful talks with Russia on several proposal involving oil and gas and also seeks the same quantum of discussions may be held with Iranian counterparts too, being our next neighbour.

In a press release issued here on Wednesday, the PBF official questioned if Pakistan is willing to engage with Russia, which is heavily sanctioned by the West, the question remains why don't we source oil and gas from Iran instead? Practically speaking, it would be cheaper and logistically more feasible as compared to any deal with Russia. The offer from Iran to Pakistan to purchase gasoline, power and gas is still valid.

Although it is widely believed that due to sanctions and trade embargoes on Iran we are not able to trade but there is a huge market for Iranian oil in Asia especially China and India.

PBF official added that shipments of Iranian crude oil to many nations, including Malaysia, were transferred to other ships and blended with crude oil grades that did not originate in Iran before they were shipped to China.

Exports of liquids like petroleum make up a sizable portion of Iran's income. The country's oil industry saw an increase in net oil export revenues to roughly $40 billion in 2021 from about $15 billion in 2020.

Similarly, he said that Iran has the third largest reserves with respect to oil and gas. According to the US based Energy Information Administration (EIA), Iran was the third-largest producer of natural gas in the world in 2020 and the fifth-largest producer of crude oil in OPEC in 2021.

It ranks as the third-biggest oil and second-largest natural gas reserve holder in the world in 2021 and has some of the largest amounts of proven oil and natural gas reserves.

Iran has 12% of the world and 24% of the middle East's oil reserves as of the end of 2021. Despite having large reserves, Iran's crude oil production has decreased since 2017 due to underinvestment and international sanctions that have affected the oil industry for a number of years.

Iran's crude oil production might resume at its full potential, which is estimated by the EIA to be 3.7 million barrels per day, if sanctions were lifted. As of September 2022, indirect talks between the United States and Iran on Iran's nuclear programme are still ongoing.

Riaz Khattak said Pakistan can get petroleum products in exchange for other products whenever it wants, and Iran is also willing to provide all the gasoline required by Pakistan.

However it is virtually impossible to formally buy Iranian oil for two main reasons. The bulk of institutions that deal in US Dollars are under US control, hence they won't permit simple US Dollar transactions with Iran.

Despite the fact there's a huge black market for Iranian petroleum products in Pakistan, especially in Balochistan, according to sources in oil marketing companies. A significant portion of the petroleum products being utilised in Balochistan and other parts of the country too.

PBF official also said the Pakistani market is not different than other consumers that prefer the cheapest rate. However, the Primary limitation of the country is its economic vulnerability.