August 1, 2025 | Bharat Tone News Desk

In a surprising move, U.S. President Donald Trump announced a trade deal with Pakistan on July 30, 2025, aimed at developing what he described as the country’s “massive oil reserves.” The announcement, made via Trump’s Truth Social platform, also hinted at potential future oil sales to India, raising eyebrows given Pakistan’s limited proven oil reserves and ongoing geopolitical tensions. This development comes just hours after Trump imposed a 25% tariff on Indian imports, citing trade imbalances and India’s continued purchase of Russian oil.

What’s the Deal About?

According to Trump, the U.S. and Pakistan will collaborate to tap into Pakistan’s oil reserves, with an American oil company to be selected for the partnership. “We have just concluded a Deal with the Country of Pakistan, whereby Pakistan and the United States will work together on developing their massive Oil Reserves. We are in the process of choosing the Oil Company that will lead this Partnership. Who knows, maybe they’ll be selling Oil to India some day!” Trump posted.

The announcement follows recent talks between U.S. Secretary of State Marco Rubio and Pakistan’s Foreign Minister Ishaq Dar, with both sides emphasizing expanded cooperation in energy, mining, and critical minerals. Pakistan’s Finance Minister Muhammad Aurangzeb also met with U.S. officials, describing the deal as a step toward lower tariffs and increased investment.

Pakistan’s Oil Reserves: Fact or Fiction?

Trump’s claim of “massive oil reserves” has sparked skepticism. According to the U.S. Energy Information Administration (EIA), Pakistan’s proven crude oil reserves stood at approximately 353.5 million barrels in 2016, ranking it 52nd globally and accounting for just 0.021% of the world’s total reserves. In contrast, India, the world’s third-largest oil consumer, has proven reserves of around 4.5 billion barrels, ranking 23rd.

While seismic surveys in Pakistan’s Offshore Indus Basin suggest potential for significant hydrocarbon deposits, no commercial drilling has confirmed these resources. Past exploration efforts, such as the Kekra-1 well in 2019, failed to yield results. A 2015 EIA study estimated Pakistan could have 9.1 billion barrels of technically recoverable shale oil, but extraction remains undeveloped due to technological and financial constraints.

Geopolitical Implications: A Jab at India?

The timing of Trump’s announcement—hours after imposing a 25% tariff on Indian goods and an unspecified penalty for India’s Russian oil imports—suggests a strategic move. Trump has criticized India’s trade policies and its role in the BRICS group, calling it “anti-U.S.” and an “attack on the dollar.” His suggestion that Pakistan might sell oil to India seems unlikely given the volatile India-Pakistan relationship and India’s robust oil import network, with Russia supplying 35% of its crude in 2025.

Experts see the deal as part of Trump’s broader strategy to pressure India into reducing Russian oil purchases and aligning closer to U.S. energy interests. “The announcement could serve political motives rather than energy motives,” said Lydia Powell, a Distinguished Fellow at the Observer Research Foundation.

What’s Next for U.S.-Pakistan Energy Ties?

Pakistan, heavily reliant on Middle Eastern oil imports costing $11.3 billion annually, could benefit from U.S. investment in its energy sector. The deal aligns with Washington’s efforts to counter China’s influence in Pakistan, a major non-NATO ally. However, without verified reserves or a clear timeline, the project’s feasibility remains uncertain.

Meanwhile, India continues trade negotiations with the U.S. to mitigate the impact of the new tariffs, which could disrupt its $129 billion bilateral trade. The U.S. is also engaging with other nations like South Korea and Vietnam on tariff reductions, aiming to address its trade deficit.

Conclusion

Trump’s Pakistan oil deal has stirred debate over its economic and geopolitical implications. While the U.S. aims to bolster Pakistan’s energy sector, questions linger about the scale of Pakistan’s reserves and the feasibility of exports to India. As global trade dynamics shift, Bharat Tone will keep you updated on how this deal unfolds and its impact on India-U.S.-Pakistan relations.

Stay tuned to Bharat Tone for the latest news on international trade, energy developments, and more.