Pakistan and Russia are in talks over a potential oil-sector agreement, signaling a deepening of energy and industrial collaboration between the two countries. The discussions come amid shifting global alliances and growing interest in diversifying energy supplies.

The federal finance minister, Muhammad Aurangzeb, says the negotiations cover oil exploration, production, and refining. Officials from both countries’ energy ministries are working through technical and commercial details.

“All of these areas are Russia’s strengths. And we would be very happy if Russia agreed on an agreement in this sector with Pakistan,” Aurangzeb says.

Pakistan began importing Russian crude in 2023 to diversify energy supplies and reduce costs. Analysts say this move is part of a broader strategy to secure more affordable and reliable energy as global markets shift.

Beyond crude imports, Russian companies are expected to participate in upgrading Pakistan’s refining capacity. This could boost domestic fuel production and reduce reliance on imported fuels.

The Russian energy minister, Sergei Tsivilev, says “We have discussed the modernization of refining capacity in Pakistan, and Russian companies are expected to participate.”

Officials say talks also include broader industrial cooperation. Plans under discussion include the construction of a new steel plant and the revival of Pakistan Steel Mills in Karachi. Feasibility studies and contract drafting are underway, with private and international partners expected to take part.

The steel mills, originally built with Soviet assistance in the 1970s, could provide jobs and strengthen domestic production. Experts say these projects reflect Pakistan’s push to expand industrial capacity alongside energy cooperation.

Observers say closer Pakistan-Russia ties could have long-term economic benefits, while providing Russia with new trade partners amid Western sanctions related to the Ukraine conflict. Pakistan is also revising trade mechanisms to allow more flexible barter trade, further supporting bilateral commerce.

Federal Minister for Petroleum, Ali Pervez Malik, represented Pakistan at the plenary session of the St Petersburg International Gas Forum (SPIGF) 2025. At the “Gas Market 2025–2035” session, Malik highlighted Pakistan’s focus on energy diversification and transparency to attract investment. The forum, attended by Gazprom Chairman Alexey Miller, Russian Energy Minister Sergei Tsivilev, and Turkish Energy Minister Alparslan Bayraktar, discussed global gas trends, energy transition, and international cooperation.

They noted that while negotiations are still ongoing, the talks mark a potential new chapter in Pakistan-Russia relations. Both countries are seeking to strengthen strategic and economic ties while securing long-term growth.