Pakistan’s Unrealistic Demand Doomed Its Oil Talks With Russia

The esteemed representatives who participated in this week's talks should have been better advised than to place Pakistan on equal footing with China and India when it comes to their country’s role in Russia’s energy geopolitics. Those two are sold discounted oil due to their status as strategic partners, their large consumption levels, and political reliability, all of which are absent when it comes to Russian-Pakistani relations. To demand equal discounts was thus delusional and likely the result of policymakers being misled by their experts.

Pakistan failed to clinch an oil deal with Russia after their latest talks in Moscow were doomed by Islamabad’s unrealistic demand. State Minister for Petroleum Musadik Malik, Secretary Petroleum Capt (retd) Muhammad Mahmood, Joint Secretary, and officials of the Pakistan Embassy in Moscow reportedly requested that Russia sell their country oil at a 30-40% discount comparable to that which they’re already selling to China and India only to be politely rebuffed.  

These esteemed representatives should have been better advised than to place Pakistan on equal footing with China and India when it comes to their country’s role in Russia’s energy geopolitics. Those two are sold discounted oil due to their status as strategic partners, their large consumption levels, and political reliability, all of which are absent when it comes to Russian-Pakistani relations. To demand equal discounts was thus delusional and likely the result of policymakers being misled by their experts.

This isn’t the fault of its world-class diplomats in Moscow who presumably passed along accurate assessments of Russian policy but of those strategists in Islamabad who in hindsight seem to have been blinded by wishful thinking and subsequently advised decisionmakers to pursue a deeply flawed policy. Russia said as early as mid-October that it wouldn’t sell oil to those countries that follow the West’s looming price cap, yet the visiting Pakistani delegation seemed completely unaware of this.

That explains why The Express Tribune, which is one of that South Asian state’s most reputable outlets, described the upcoming cap as a so-called “roadblock” in their report about those talks. While it’s true that Finance Minister Ishaq Dar recently declared that “America cannot stop us from buying oil from Russia” and the US in turn confirmed that it has no particular objection to this, Western insurers and shipping companies would obviously refuse to facilitate the transaction once the price cap is imposed.

This means that it would have practically become impossible for Pakistan to purchase Russian oil above whatever level the West unilaterally decides to cap since it lacks alternative insurance and shipping means for facilitating that transaction. Similarly, it would have been politically impossible for Pakistan to purchase Russian oil at or below that aforesaid level since Russia already made it clear that wouldn’t sell to countries that comply with the West’s cap.

Nevertheless, it’s speculated that the discounts afforded to China and India are already within the reported range of the price cap, yet exports will presumably continue since those two are grandfathered in after previously proving their political reliability. Had Pakistan gone through with former Prime Minister Khan’s reported attempt earlier this year to purchase oil at a similarly discounted level prior to the post-modern coup, then it too could have continued to benefit if it had the means for facilitating it.

Even absent those alternative insurance and shipping systems, it could have relied on Russian oil imports to relieve economic-financial pressure across the past eight months before the price cap enters into effect on 5 December. Instead, the post-modern coup regime’s perception managers were ordered to deny those reported talks as part of their puppet masters’ campaign to discredit former Prime Minister Khan’s government while his replacements informally suspended them under US pressure.

Those interconnected moves completely destroyed the burgeoning trust between these countries, and it was only after Pakistan’s economic-financial crisis spiraled out of control over the summer that the post-modern coup regime began entertaining the possibility of resuming these talks out of desperation. The US realized that not openly standing in its proxy’s way would pragmatically relieve some public pressure upon them simultaneously with helping the post-modern coup regime manage this crisis.

What happened afterwards was nothing short of total incompetence after the post-modern coup regime failed to seize this narrow window of opportunity for clinching a short-term deal with Russia prior to the looming price cap that was already talked about as early as this summer’s G7 Summit. Had they done so, then this could have helped them better manage the economic-financial crisis catalyzed by last spring’s regime change, but they dillydallied for months until it was literally too late as explained.

Be that as it was, those Pakistani experts who received the accurate assessments of Russian policy that were presumably passed along to them by their world-class diplomats in Moscow were so blinded by wishful thinking that they thought that they could clinch a deal on the same terms as China and India. It can’t be known for sure what was going through their minds, but they seem to have made a fatal analytical mistake that culminated in this week’s failed talks.

The only reason why the decision would have been made to go through with these obviously doomed-to-fail talks is that these experts must have told policymakers that Russia is supposedly so desperate for revenue that it’ll tacitly comply with the looming price cap and thus sell their US-backed post-modern coup regime oil at the same price as China and India. It’s truly disappointing that they thought so little of Russia’s stated refusal to do so that they thought it would so brazenly abandon this policy.

This insight very strongly suggests that those Pakistani experts tasked with formulating their country’s approach to Russia are now operating under US influence after falling for the latter’s false narrative that Moscow is supposedly so weak that it’s now unilaterally conceding on its objective national interests. Not only that, but they were also evidently confident that it would do so in the face of demands from a US puppet government like theirs as the ultimate humiliation before the world stage.

They should have known better, which speaks to the uncomfortable observation that they really don’t understand Russia all that well, thus raising credible concerns that more such policy failures are inevitable unless their urgently correct their flawed perceptions of that country’s strategic calculations. It’s unclear whether these same experts were in place prior to the post-modern coup or if they were installed afterwards, but in any case, this mishap inarguably could have been avoided.

What needs to happen as soon as possible is for Pakistani experts to acknowledge their mistake. Falling for the US’ false narrative about Russia’s supposed weakness and subsequently expecting Moscow to reverse course on its publicly stated refusal to sell oil to those countries that comply with the West’s price cap is what was most responsible for this fiasco. Hopefully they’ll correct this flawed perception in order to formulate more practical policies towards Russia in the future and not waste everyone’s time.