ExxonMobil likely to come back for offshore venture
As Pakistan is celebrating US President Donald Trump's announcement of joint development of Pakistan's oil reserves, Washington has not signalled whether its energy giant ExxonMobil will make a comeback to participate in bidding for offshore oil and gas fields.
Though Pakistan and the US have a long history of relationship, American oil and gas companies have not remained very active here. Pakistan's two provinces – Khyber-Pakhtunkhwa and Balochistan— are rich in oil and gas deposits, however, security challenges have hindered progress on potential projects.
Distrust between Pakistan and the US still prevails as conspiracy theories suggest that offshore fields in Karachi seawaters have significant hydrocarbon reserves.
Many people believe that Pakistan did not allow ExxonMobil to go further beyond in sea for offshore exploration during the tenure of Pakistan Tehreek-e-Insaf (PTI) government. Reports indicate that the US company sought access to an additional area in Kekra field to assess prospects of finding oil and gas but Pakistan expressed hesitation.
Now, the US president has struck a new agreement for oil and gas field development in Pakistan. It comes at a time when Islamabad is inviting foreign companies to submit bids for offshore fields, which will open on September 30.
Background discussions with officials revealed that the US had scores of private energy companies, but there were no signals which one would take part in field development. Pakistan expects ExxonMobil to come back for a new offshore exploration venture.
However, Pakistani officials point out that Trump's announcement is just a commitment that US energy companies will come to Pakistan. "It will be clear in the coming days when the two countries will start official-level talks by including energy companies to look for opportunities of joint ventures," remarked an official.
This is encouraging news as the US has been inclined towards India in the past. Even Indian oil and gas companies had formed joint ventures with US firms.
Earlier, Washington even refused to export liquefied natural gas (LNG) to Pakistan and showed interest in dealing with Delhi. At that time, a US embassy official told media that Indian companies had entered into joint ventures with US firms; therefore, the doors for LNG trade were open for India, not Pakistan.
Of late, the US president has hinted at American companies' investment in Pakistan's mineral sector. US Exim Bank is one of the financiers interested in pumping capital into the Reko Diq copper and gold mining project.
US companies are also keen to forge joint ventures with Pakistani firms in the mineral sector, which has estimated potential worth $8 trillion. Experts call it a new opening in bilateral relationship between Pakistan and US that will clear the way for notable investment.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Recorder
2 minutes ago
- Business Recorder
Dovish India RBI tone may aid sustained lower yields more than rate cut, traders say
MUMBAI: A dovish commentary and downward revision to economic forecasts by the Reserve Bank of India could drive a continued fall in government bond yields and overnight index swap rates, even without an actual rate cut, treasury officials said on Tuesday. The RBI is set to announce its policy decision on Wednesday, where most economists expect the central bank to hold rates steady but calls for a cut have grown louder in recent days. 'A dovish pause will be better and more positive for markets in the long term than a hawkish rate cut like the one in June,' PNB Gilts senior executive vice-president Vijay Sharma said. 'The chances of the 10-year bond yield reaching 6.20% are better with a pause than with a cut.' In June, the RBI surprised markets with a 50-basis-point rate cut but shifted its stance to neutral from accommodative, and signalled limited room for further easing. Bond yields and swap rates rose following the decision, as traders interpreted it as the end of the rate-cutting cycle. The 10-year benchmark bond yield rose on June 6 and has climbed nearly 20 bps since, while the five-year OIS rate rose by as much as 16 bps. RBI intervention shields Indian rupee from record low after Trump tariff threat 'The RBI did a lot in the last policy, so it would rather wait to see the impact and another rate cut is unlikely. Also, a cut now may not have the desired impact,' said Alok Singh, group head of treasury at CSB Bank. Barclays expects a dovish pause along with a 30–40 bps reduction in the RBI's inflation forecast of 3.7% for this fiscal year. Still, expectations for easing have strengthened after the U.S. slapped a 25% tariff on goods from India, which could weigh on growth. 'We believe there are enough reasons for the RBI to deviate from its previous guidance, deliver a further 25 bps easing in August, and adopt a more open-ended approach to future rate cuts,' Emkay Global economist Madhavi Arora said.
Business Recorder
2 minutes ago
- Business Recorder
India's Nayara exports first gasoline since sanctions, sources say
NEW DELHI/SINGAPORE: Russia-backed Indian refiner Nayara Energy has exported its first gasoline cargo since the privately-owned company was sanctioned by the European Union on July 18, according to four shipping sources and LSEG data. The tanker Tempest Dream, carrying about 43,000 metric tons (363,350 barrels) of gasoline, sailed on Monday, according to the sources and LSEG shipping data. The vessel, sanctioned by Britain in June, is headed to Sohar, Oman, shipping data showed, although buyer details could not be verified. Mumbai-based Nayara Energy did not immediately respond to a Reuters request for comment. A second vessel, the Sard, is currently at the western Indian port of Vadinar used by Nayara, set to lift about 43,000 tons of diesel, according to two sources and LSEG shipping data. Supertanker delivers oil to sanctioned Nayara Energy's Vadinar refinery, sources say Nayara has been forced to reduce crude runs at its 400,000-barrel-per-day refinery in Vadinar due to difficulties in obtaining ships and selling fuel from the port in the wake of the sanctions, Reuters has reported. Nayara, which runs 6,600 fuel stations in India, has approached state fuel retailers for domestic sale of products, industry sources have said. It recently used tanker Leruo to move about 43,000 tons of diesel to Mundra port in western India, data from traders and Kpler shiptracking showed. The Leruo and Sard have been sanctioned by the EU since July and May respectively.
Business Recorder
2 minutes ago
- Business Recorder
India's corporate earnings growth stays weak, banks and IT firms disappoint
India's listed companies posted yet another quarter of lackluster earnings in the April-to-June period, extending a bout of weakness which began last year and weighed on benchmark stock indexes. The Indian economy is expected to grow at a world-beating 6.5% in the current fiscal year and inflation has been low. Yet, sectors from banks to IT services are facing earnings pressure from pockets of weakness in domestic and global demand. Aggregate profit growth for 38 of the Nifty 50 firms that have reported so far stood at just 7.5%, according to Motilal Oswal Financial Services. Jefferies said that full-year earnings per share estimates for 113 companies on the MSCI India index have been trimmed by 1.7%, with growth now projected at 8%. U.S. President Donald Trump's 25% tariff on shipments from India threatens to further cloud the outlook for export-heavy sectors. Trump has also warned of harsh tariffs over India's Russian oil imports—an action New Delhi called 'unjustified.' Earnings growth for Indian companies has been in single digits for five consecutive quarters, below the 15%–25% growth seen between 2020–21 and 2023–24, which fueled a 160% surge in the Nifty 50 index. Since the start of the fiscal year 2025, the Nifty has risen 10%. 'It's clear that the earnings momentum has stalled, with slower credit growth dragging down performance of financials. However, this isn't just a sectoral story—it reflects broader weakness in nominal growth,' Avinash Gorakshakar, director of research at Profitmart Securities said. Castrol India's second-quarter profit rises on higher demand Nominal GDP growth, which includes inflation, and is more relevant to corporate profitability, is seen staying below 10% for the third straight year. 'A real revival may take shape only in the second half of FY2026—if credit growth revives, private capex kicks in, and a good monsoon boosts rural demand. Until then, the benchmarks are likely to remain rangebound,' said Gorakshakar. Banks — the heaviest sector in the Nifty — delivered mixed results in the June quarter. Lenders reported lower margins following steep policy interest rate cuts and as bad loans in segments such as consumer loans, credit cards and microfinance started to rise. IT firms, the second-largest sector in the Nifty, also saw a subdued quarter amid persistent demand weakness from the U.S., a key market. There were a few bright spots in the June-quarter earnings, with auto, cement, and select infrastructure companies meeting or beating expectations. Analysts lowered their full-year profit forecasts for more companies, though the number of downgrades was lower than in the previous three quarters. 'The earnings engine is clearly sputtering. Margin strain in banks, tepid global IT demand, and weak nominal growth have stalled profit momentum,' said Samrat Dasgupta, chief executive of Esquire Capital Investment Advisors. 'Until credit and consumption revive meaningfully, markets may find little earnings firepower to break higher.'
