Pakistan turns to Nigerian crude as Middle East routes come under threat

Pakistan is turning to Nigeria for its crude oil as escalating tensions in the Middle East threaten traditional supply routes through the Strait of Hormuz and the Bab el-Mandeb Strait, prompting the South Asian nation to diversify its energy imports to keep its fuel flowing.

The move comes as a response to reports of renewed closures at the Strait of Hormuz. In addition, Iran-backed Houthi militants have declared a blockade on Saudi oil, compounding the issue of exports moving from the Red Sea port of Yanbu through the Bab el-Mandeb Strait.

The supply concerns extend beyond crude oil. Pakistan’s liquefied natural gas (LNG) imports have also been disrupted, with cargoes from long-term supplier Qatar affected by the crisis around the Strait of Hormuz, forcing the country to procure LNG on the spot market at significantly higher prices.

It was reported last August that Pakistan Refinery Limited will import its first cargo of Nigerian Bonny Light crude from Vitol as Asian refiners shift towards cheaper alternatives to Middle Eastern oil.

However, data gleaned from the National Bureau of Statistics and TradeMap showed that Pakistan has never purchased crude oil from Nigeria.

Further analysis revealed that the South Asian country is a buyer of petroleum gases and other gaseous hydrocarbons from Nigeria. According to TradeMap, Pakistan bought $370 million worth of liquefied and gaseous natural gas, propane, butane, and specific alkenes like ethylene, propylene, and butylene in 2024.

At an emergency meeting with chief executives and managing directors of the country’s refineries, Ali Pervaiz Malik, Pakistan’s federal minister for petroleum and natural resources, briefed industry leaders on the deteriorating security situation stemming from the renewed conflict involving the United States, Iran and the Houthis.

The minister directed refinery operators to urgently identify alternative crude oil suppliers to ensure uninterrupted fuel supplies, triggering a search for cargoes from Nigeria, the United States, Singapore and Central Asian countries.

Nigeria, Africa’s largest crude producer, emerged as one of the preferred alternatives as supplies from outside the Gulf can bypass the Strait of Hormuz, reducing exposure to the escalating regional conflict.

Pakistani refiners have also begun engaging international trading companies to determine the availability of crude cargoes from these markets.

Imports through Oman’s ports are also under consideration, although industry officials view that route as carrying relatively higher risks under the current security environment.

Pakistan Arab Refinery Company (Parco), Pakistan Refinery Limited (PRL) and National Refinery Limited (NRL) continue to receive crude from the United Arab Emirates through the Port of Fujairah, which lies outside the Strait of Hormuz.

However, Saudi crude imports from the Red Sea port of Yanbu have become increasingly uncertain following Houthi threats to disrupt shipping through the Bab el-Mandeb Strait.

Parco has reportedly requested the United Arab Emirates to supply seven crude cargoes through Fujairah, above its usual four to five cargoes. The refinery typically supplements these shipments with two cargoes from Saudi Arabia via Yanbu but is now preparing to meet its entire crude requirement through Fujairah if supplies from the Red Sea remain disrupted.

Cnergyico Pakistan Limited, which has traditionally sourced crude from the United States, Africa and Central Asia, will continue importing from those markets, according to industry sources.

Officials expect greater clarity on the viability of Yanbu shipments within days, but the government has instructed refiners to continue identifying additional supply sources to strengthen Pakistan’s energy security.

Singapore has also become a focus of Pakistan’s search because it hosts major oil trading firms with crude cargoes already loaded and at sea, offering refiners the prospect of securing prompt deliveries if disruptions in the Middle East worsen.