Pakistan economy may hit worst blow as nightmare scenario predicted

Pakistan economy may hit worst blow as nightmare scenario predicted

ISLAMABAD - Pakistan economy may face a worst blow and nightmare like scenario as the oil prices in the international market are set to touch $100 per barrel.

Pakistan may have to bear an additional bill for billions of dollars if the international oil prices reach $100 billion mark as over 80% of Pakistan oil needs are met with imported oil and fuel.

Almost 2 million barrels per day (bpd) of crude could be taken out of the market as a result of the U.S. sanctions against Iran by the end of the fourth quarter this year, said Daniel Jaeggi, president of commodity merchant Mercuria Energy Trading, making a crude price spike to $100 a barrel possible.

Such a price rally would mark the first time since the summer of 2014 that oil would return to the $100-a-barrel level that became the norm in the early part of this decade

“We’re on the verge of some significant volatility in Q4 2018 because depending on the severity and duration of the Iranian sanctions, the market simply does not have an adequade supply response for a 2 million barrel a day disappearance of oil from the markets,” Jaeggi said.

Washington has already implemented financial sanctions against Iran and it plans to target the country’s oil exports from November 4, putting pressure on other countries to also cut Iranian crude imports.