Pakistan will pay for crude oil purchases from Russia likely to begin in late March, in currencies of friendly countries, Russia's Energy Minister Nikolay Shulginov said on Jan. 20.
Shulginov is in Islamabad for an annual inter-governmental commission on trade and economy between Pakistan and Russia.
"We have agreed that the payments will be made in the currencies of friendly countries," he said at a joint news conference with Pakistan's Economic Affairs Minister Ayaz Sadiq.
He did not specify the 'friendly countries' and neither of the two ministers gave details on the size of the planned purchases.
Pakistan's Petroleum Minister Musadik Malik told local Geo News TV separately that Islamabad wants to import 35% of its total crude oil requirement from Russia.
Energy purchases make a major chunk of imports for Pakistan which is facing a severe balance of payment crisis with its foreign exchange reserves falling to $4.6 billion, barely enough to cover three weeks of imports.
Historically the South Asian country has had no major commercial relations with Moscow, unlike neighboring India, hence payment mechanisms in light of Western-led financial sanctions on Russia are likely to present a challenge.
Pakistan depends on oil from Gulf countries, mainly due to close political and friendly ties, which often extend facilities like deferred payments, and that route is cheaper logistically given proximity to the Strait of Hormuz.
The energy deals follow a visit to Moscow in November by a Pakistani delegation including Malik.
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