U.S. President Donald Trump has announced that an agreement has been reached between the United States and Pakistan to explore and extract Pakistan’s vast oil reserves. In a statement posted on his social media platform, Truth Social, President Trump said that Washington has finalized a partnership with Islamabad to work together on converting Pakistan’s untapped oil resources into recoverable reserves. He added, “Right now, we are in the process of selecting an oil company to lead this partnership.” He further remarked, “Who knows, maybe one day they’ll be selling oil to India!” This announcement comes at a time when Pakistan’s domestic oil and gas production has been steadily declining over the past few years. As a result, the country has become increasingly reliant on imports to meet its growing energy needs. According to data released by the Pakistan Petroleum Information Services, domestic oil production dropped by 11% during the first nine months of the current fiscal year. The decline was observed across major oil and gas fields, including Qadirpur, Sui, Uch, and Mari, among others. Several major exploration and production companies operating in Pakistan have also reported a fall in local output. In the wake of President Trump’s statement, many observers and online users have raised questions about the actual location of these so-called "vast reserves". There is also growing curiosity about where oil exploration has taken place in Pakistan and whether this new US-Pakistan oil partnership might impact China’s existing investments in the country's energy sector.
Several companies are operating in Pakistan’s oil exploration sector, yet there has been no significant increase in oil production over the past few decades. According to data released by the Pakistan Petroleum Information Services, the country’s oil reserves stood at 23.8 million barrels as of December 2024. Wasi Khan, an energy expert who has held senior positions in various oil companies, said locally produced oil in Pakistan only meets 10 to 15 percent of domestic demand, while the remaining 80 to 85 percent is imported. He explained that, according to assessments by the U.S. Energy Information Administration, Pakistan could potentially hold up to 9 billion barrels of petroleum reserves. However, he emphasized that these cannot be classified as proven reserves until they are found to be commercially viable. Wasi noted that previous oil exploration efforts in Pakistan have not been particularly successful, largely due to insufficient investment and a lack of advanced technology. Commenting on President Trump’s recent announcement, he said it appears that the U.S. government may task a major oil company with developing Pakistan’s untapped petroleum resources.
Oil exploration in Pakistan is currently underway across all four provinces, with experts noting that the most extensive activity is taking place in Sindh. According to a report by the Pakistan Credit Rating Agency (PACRA) on oil and gas exploration and production in Pakistan, there are presently 247 oil and gas wells in Sindh, 33 in Punjab, 15 in Khyber Pakhtunkhwa (KP), and 4 in Balochistan. The report notes that some of these wells have been fully exploited and are now dry, while operations continue at others. According to Dr. Aafia, an energy expert at the Pakistan Institute of Development Economics (PIDE), technically speaking, exploration activities in Balochistan and KP are minimal at present. The main reasons include security concerns and complications in tax and revenue structures. She suggested that by offering greater revenue-sharing incentives to the provinces, they could be made more responsible for maintaining security for energy projects. The Oil and Gas Development Company (OGDC) discovered major oil and gas reserves in Lakki Marwat's FR Betani area of KP in September 2021. Similarly, Mari Petroleum made a significant discovery in the Shiwa Tehsil of the Bannu West Block, North Waziristan, in June 2022 — the last major find in the sector so far. Parliamentary Secretary for Petroleum, Mian Khan Bugti, while Sindh continues to see substantial exploration activity, the government is working to extract petroleum reserves in Balochistan and KP as well. Regarding President Trump's recent statement, he said it is too early to comment on specifics but called the announcement a positive development for Pakistan’s energy sector.
U.S. President Donald Trump, while announcing plans to extract oil reserves in Pakistan, stated that both countries are currently in the process of selecting an oil company to lead this joint venture. Speaking about past involvement of American oil companies in Pakistan, energy expert Wasi Khan noted that several U.S. firms have been active in Pakistan's oil and gas sector in previous decades. In particular, Occidental Petroleum and Union Texas played a significant role in oil exploration and development activities. According to Khan, these companies contributed notably during the early development phase of Pakistan’s upstream oil and gas industry. Although their presence has diminished over time, there was a period when these firms were considered major players in the sector.
Wasi Khan stated that this development should be viewed in a positive commercial context. He said that increased international cooperation in Pakistan's energy sector could promote further investment, advanced technology, and healthy competition. He emphasized, "China is a trusted and longstanding partner of Pakistan, and the involvement of American companies does not undermine this relationship. It could complement existing Chinese investments, as it helps diversify opportunities." According to him, "This potential partnership could also be equally beneficial for China. As large-scale projects move forward, Chinese firms—which have a strong presence in Pakistan’s infrastructure and energy sectors—could play new roles in construction, engineering, or service industries." Geopolitical economy expert Zahid Hussain, while the U.S. announcement has just been made, and full details are yet to emerge, there are no direct implications for China's investments and projects in Pakistan. However, he acknowledged there could be indirect geopolitical consequences. Mian Khan Bugti added that China has its independent economic cooperation and projects with Pakistan, just as Pakistan maintains trade and economic relations with other countries on separate terms. He dismissed the idea that U.S. oil exploration in Pakistan could negatively impact China's ongoing projects, asserting that both partnerships can coexist.
Following President Trump’s announcement about oil reserves in Pakistan, both Pakistani and Indian users took to social media to express their views. A user, Hussain Nadim, sarcastically commented, “Pakistan has just found out that it has oil reserves. Thanks to President Trump’s tweet. This is a comedy now.” Analyst Michael Kugelman wrote on X (formerly Twitter), “US President Donald Trump has announced that the US and Pakistan have signed a deal to promote Pakistan’s vast oil reserves. In recent weeks, Pakistan has highlighted the growing estimates of its oil potential.” Faisal Ranjha tweeted, “A trade deal has been reached between the US and Pakistan. The US will assist Pakistan in exploring its vast oil reserves, and one day it will export to India. President Trump is mocking the Indian people. This is an ultimate insult to Modi Ji.” India’s former Foreign Secretary Kanwal Sibal expressed anger over the announcement, stating, “This statement reflects Trump’s mindset even more clearly. He wants India to accept the 25% tariffs and penalty as dictated.” He added, “America’s joy is built on others' pain, and Trump will decide who deserves this ‘joy.’” Regarding the US oil investment in Pakistan, he remarked, “This contradicts Trump’s usual insistence that other countries invest in America. The US is already the world’s largest oil producer and has stakes in other oil-producing nations—so what interest does it have in Pakistani oil? Even China, a major oil importer with investments in Pakistan, has not announced any such production plans there.” Referring to Trump's mention of Pakistan exporting oil to India, he called it “a ridiculous mockery,” stating, “Why joke about Pakistan selling oil to India when India has access to major regional suppliers, including Iran?” Another Indian user, using the handle Constate Gardner, wrote, “Not really… as everyone now knows, Trump is just pressing all the buttons to negotiate a trade deal. Remember, we are the land of mind games. We can get rid of this easily.” A Pakistani user, Fareed, expressed a similar opinion, saying on X, “I think Trump is making up this lie about Pakistan’s oil reserves just to pressure India. He believes this tactic could deliver quick results.” Indian journalist Ishan Prakash also shared his view, writing, “It seems this statement is more about unsettling India than about any real development in Pakistan’s oil fields.”
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