Pakistan could seek to be included in Saudi Arabia’s preferred buyers of crude exported from the Red Sea amid the major disruption to tanker traffic in the Strait of Hormuz, sources told Pakistani outlet The News.
The escalating conflict in Iran and Tehran’s retaliatory strikes on landmarks and airports in Gulf countries including the UAE, Kuwait, and Bahrain, have effectively halted oil and LNG tanker traffic via the vital Strait of Hormuz, where a fifth of global oil and LNG flows pass. While the Strait is not formally closed, major shipping operators and oil and gas companies, and traders have effectively halted shipments through the narrow lane between Iran and Oman.
In view of the disruption in the Strait of Hormuz and the highly uncertain timeline of when traffic and trade could return to some semblance of normality, Pakistan may be looking for supplies that pass through the Red Sea.
Pakistan could seek inclusion in Saudi Arabia’s list of preferred countries for crude supplies via the Red Sea if the disruption at the Strait of Hormuz persists beyond 10-12 days, sources at Pakistan’s Petroleum Division told The News.
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Pakistan depends on Strait of Hormuz flows as it imports LNG from Qatar, diesel from Kuwait, and crude from Abu Dhabi National Oil Company (ADNOC), the state energy firm of the United Arab Emirates.
Two crude oil tankers bound for Pakistan are currently stranded around the Strait of Hormuz, including one tanker, MT Karachi, operated by the national flag carrier Pakistan National Shipping Corporation (PNSC), officials told The News. A third cargo that was loading when the U.S. and Israeli attacks on Iran started this weekend is unlikely to depart soon, considering the current war-risk conditions, the outlet notes.
In some relief to Pakistan’s LNG supplies, two LNG carriers had already crossed the Strait of Hormuz when the escalation began, and are expected to arrive in Pakistan in a few days.
By Charles Kennedy for Oilprice.com
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