Pakistan to import US crude for first time after Trump trade deal

Business Standard

5 days ago

Pakistan's top refiner will receive its first-ever US crude shipment in October, following a new Trump-brokered energy pact aimed at deepening trade and geopolitical ties
New Delhi
Pakistan's largest refiner Cnergyico will import one million barrels of crude oil from Vitol in October, the company's vice-chairman Usama Qureshi said on Friday. This marks the country's first-ever purchase of US-origin oil, following a landmark trade agreement.
Why it matters
This is the first time Pakistan will import crude oil from the United States. The shift follows a strategic trade agreement amid rising US tariffs and shifting alliances in the region.
State of play
Pakistan's largest refiner Cnergyico will import one million barrels of crude oil from Vitol in October, the company's vice-chairman Usama Qureshi confirmed. The deal marks a first for US-origin crude entering the country.
Zoom in: West Texas crude to arrive in Karachi
The shipment of West Texas Intermediate light crude will be loaded from Houston this month and is expected to arrive in the second 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,' Qureshi said, adding the cargo is not for resale.
Between the lines: Trump's energy diplomacy deepens ties
The import decision follows President Donald Trump' s announcement of a new US–Pakistan energy initiative. Trump claimed Pakistan had 'massive' oil reserves and even suggested it could eventually export oil to India.
His comments came amid heightened tensions with India, where Trump has imposed 25 per cent tariffs and criticised India's crude purchases from Russia.
What they're saying
Qureshi said the deal followed several rounds of talks starting in April, shortly after Trump threatened to impose 29 per cent tariffs on Pakistani imports.
Pakistan later welcomed the agreement, citing tariff relief and greater investment prospects, though details on revised tariff levels remain unclear.
Context: A diplomatic shift amid regional tensions
A close ally of China, Pakistan has moved closer to the Trump administration after facing tariff threats. Islamabad credits the US for helping ease tensions with India and has even nominated Trump for the Nobel Peace Prize.
Numbers game
Oil is Pakistan's biggest import item, accounting for nearly 20 per cent of its total import bill.
Oil imports (FY25): 11.3 billion dollars
Cnergyico's processing capacity: 156,000 barrels per day
It also operates the country's only single-point mooring terminal near Karachi, enabling it to handle large tankers — an edge over other refiners
The bottom line
The US–Pakistan oil deal marks a diplomatic and economic pivot, giving Islamabad an energy alternative while strengthening ties with Washington at a time of growing strain with India.