Pakistan is set to get its first crude oil shipment from the US later this year after US President Donald Trump announced a trade deal with the country. Trump also said that the US will be helping Pakistan develop ‘massive oil reserves’.The agreement came after several rounds of discussions that commenced in April, following US President Donald Trump’s announcement to levy 29% tariffs on Pakistani imports.
Pakistan Set To Get US Crude Oil
Cnergyico, Pakistan’s biggest refinery, has finalised a deal with Vitol to import 1 million barrels of American oil, according to vice chairman Usama Qureshi’s statement to Reuters on Friday. This is Pakistan’s first acquisition of US crude oil following a significant trade agreement.Pakistan’s largest import commodity is oil, with imports valued at $11.3 billion for the fiscal year ending June 30, 2025, which is approximately one-fifth of the nation’s total imports.Also Read | Donald Trump to help Pakistan build ‘massive oil reserves’! How much known crude oil does it have & how does that compare to India? Top points to knowThe import agreement will enable Pakistan to expand its crude oil procurement sources and decrease its dependence on Middle Eastern suppliers, who currently provide almost all of its oil requirements.The shipment of West Texas Intermediate light crude will depart from Houston this month, with an expected arrival at Karachi port in the latter half of October.“This is a test spot cargo under our umbrella term agreement with Vitol. If it is commercially viable and available, we could import at least one cargo per month,” Usama Qureshi said, saying that they would not resell the shipment.Qureshi indicated that after the April tariff declaration, Pakistan’s finance and petroleum ministries urged domestic refineries to consider importing crude oil from the United States.Also Read | ‘India has not been a great global actor’: Donald Trump administration fires fresh salvo after 25% tariff; says Russia oil ‘most certainly a point of irritation’The company’s facility can process 156,000 barrels of crude daily and maintains Pakistan’s sole single-point mooring terminal near Karachi, allowing it to accommodate large tankers, unlike other Pakistani refineries.Qureshi indicated plans for a second offshore terminal to facilitate larger or more frequent deliveries, alongside refinery upgrades planned over the next five to six years.Operating at 30-35% capacity due to subdued local demand, the refinery anticipates growth in petroleum product consumption.“We expect run rates to rise as domestic demand strengthens and local production is prioritised over imported fuels,” Qureshi said.
Pakistan Faces 19% Tariff
On Thursday, Pakistan welcomed a trade agreement with the US, its main export destination. According to Donald Trump’s latest executive order, Pakistan now faces a reduced tariff rate of 19% effective August 7, 2025.Pakistan, a significant ally of China, has been adopting a more favourable stance towards Trump following his tariff threats. Trump has said that the US would collaborate with Pakistan to develop the nation’s “massive oil reserves”, though he provided no additional information.Also Read | 25% on India, 19% on Pakistan, 35% on Iraq: Full list of US tariff rates announced by Donald Trump; who’s worst-hit?
