The United States and Pakistan have inked a trade deal that will involve the joint development of Pakistan’s oil resources.
“We have just concluded a Deal with the Country of Pakistan, whereby Pakistan and the United States will work together on developing their massive Oil Reserves,” President Trump said on social media.
“We are in the process of choosing the Oil Company that will lead this Partnership. Who knows, maybe they’ll be selling Oil to India some day!” Trump also said on Truth Social.
Pakistan is an importer of energy, but it may hold substantial reserves of oil and gas in shale formations, according to a report by the U.S. Energy Information Administration from 2015. Per that report, the country may have technically recoverable oil reserves of 9.1 billion barrels along with gas reserves of 586 trillion cu ft.
This year, Pakistan updated its oil and gas reserves estimate, revising the oil reserves part upwards by 23% from a year earlier, to 238 million barrels. The revision came on the back of seven fields where discoveries were made in the period.
There were no details about the tariff size included in the deal, but the Pakistani financial ministry said that the deal “will result in reduction of reciprocal tariffs, especially on Pakistani exports to the United States,” as quoted by Reuters.
“This deal marks the beginning of a new era of economic collaboration,n especially in energy, mines and minerals, IT, cryptocurrency and other sectors,” the ministry elaborated, without mentioning the actual size of the tariff. Trump had threatened the country with a tariff of 29%, Reuters recalled in its report on the news.
Earlier in the year, media reported that Pakistan was keen to start importing crude oil from the United States to reduce its trade surplus with it. Whether oil imports have been made part of the deal has not been specified.
By Charles Kennedy for Oilprice.com
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