New Delhi: US President Donald Trump’s announcement to collaborate with Pakistan on oil exploration and mining is an “unforced error” that could cost substantial amounts of money, as past attempts to uncover oil deposits in the country have repeatedly failed to yield results, according to an article.
“By agreeing to assist in oil extraction, Trump is continuing his expedient repositioning in the region. Still, in doing so, the US President is also overlooking the inevitable strategic pitfalls that lie ahead of this move. While Balochistan serves as a significant source of natural gas in Pakistan, the prospect of oil in the province has long eluded successive governments. Islamabad has repeatedly pointed towards unproven assessments that the country, and its surrounding waters, could be home to billions of barrels of untapped oil, only for each claim to eventually be disproved by unsuccessful drill attempts,” the article by Marcus Andreopoulos, published in Inkstick, pointed out.
“The sharp uptick in violence targeting Chinese workers and infrastructure projects in Pakistan over the last three years should serve as a further warning against greater US involvement in the country,” the article states.
Islamabad, on the other hand, will be hoping that Trump can overlook any misgivings and can channel much-needed American investment its way, whether or not Washington will ever see any returns on its outlay, it points out.
Other analysts also see Trump’s enthusiasm for Pakistan’s “massive oil reserves” as puzzling, as the Asian country’s crude oil reserves are estimated at a mere 234 to 353 million barrels, placing it around 50th globally. Pakistan is dependent on imports to meet its oil needs and currently imports oil from the US as well.
Even if oil extraction were to succeed, particularly in Balochistan, where reserves are believed to exist, the consequences could be destabilising. Balochistan has long been a flashpoint of ethnic and political unrest, exacerbated by perceptions of exploitation by foreign powers. China’s heavy footprint in the region through the China-Pakistan Economic Corridor (CPEC) has already fuelled resentment. US involvement in resource extraction could further alienate local populations and entangle Washington in a volatile domestic conflict.
Balochistan holds strategic interest for the US as a potential vantage point to keep a close watch on Iran. But leveraging the province for geopolitical gain is fraught with the risk of escalating tensions in a region that harbours strong anti-Western sentiment.
According to Worldometer data, Pakistan had 353.5 million barrels of proven oil reserves as of 2016, placing it 52nd globally and accounting for just 0.021 per cent of the world’s total reserves.
At current consumption levels of about 556,000 barrels per day, these reserves would cover less than two years of domestic demand if the country does not import oil, according to Worldometer data.
Daily oil production is around 70,000–80,000 barrels per day, which covers only about 15–20 per cent of its own consumption.
An Indian Oil Corporation official pointed out that the current price of petrol in Pakistan is Rs 272.15 per litre, and for high-speed diesel it’s Rs 284.35 per litre, which are more than twice the prices of these fuels in India. These are among the highest prices in the world and reflect the high degree of dependence on imports.
The oil exploration success rate is extremely low, and political, financial, and security concerns are a major concern for investors. The refining capacity in Pakistan is also limited and ageing, the Indian Oil official further added.
(IANS)
