Pakistan's largest refiner boosts U.S. crude imports amid Hormuz disruption concerns

Pakistan's largest oil refiner, Cnergyico, is expanding its imports of U.S. crude oil as the nation seeks to diversify its energy sources and mitigate risks associated with disruptions in key shipping lanes.

The decision comes amid ongoing concerns over the security of the Strait of Hormuz, a critical chokepoint for global oil transit, particularly for Pakistan's traditional suppliers in the Persian Gulf. By increasing U.S. crude purchases, Pakistan aims to secure its energy supply chain and reduce its dependence on routes that have become vulnerable due to regional conflicts.

Cnergyico has already imported approximately 8.1 million barrels of U.S. crude over the past nine months. According to Vice Chairman Usama Qureshi, these imports accounted for about 80% of Pakistan's overall increase in U.S. import payments, which rose by $914 million to $3.27 billion in the fiscal year ending June. The refiner is considering spot purchases alongside longer-term contracts, prioritizing factors like pricing, reliability, and supply security.

Beyond energy security, Pakistan also aims to leverage increased U.S. imports to help narrow its trade deficit and potentially secure reductions in trade tariffs. The government is exploring trade-finance facilities to allow Pakistani buyers to defer payments to U.S. exporters, further facilitating these imports. Meanwhile, Cnergyico is also undertaking a significant $1.2 billion upgrade to meet Euro V standards, reduce furnace oil output, and expand its refining capacity.

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pricing, reliability and supply security