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U.S. and Pakistan Sign Landmark Oil Development Deal Amid Shifting Regional Alliances

The U.S. and Pakistan have sealed a major oil trade deal to boost energy development.

President Trump and PM Sharif say the agreement will deepen economic and strategic ties.

The United States and Pakistan have entered into a new oil development trade agreement aimed at boosting Pakistan’s energy sector with American expertise and investment. Announced on July 30, 2025, by U.S. President Donald Trump, the agreement includes the selection of a U.S.-based oil company to spearhead oil exploration and development projects within Pakistan.

Key aspects of the deal involve tariff reductions, enhanced energy sector cooperation, and a shared commitment to long-term strategic engagement. The agreement is expected to unlock new avenues for economic collaboration between Washington and Islamabad, with Pakistan seeking to modernize its energy infrastructure and reduce reliance on costly imports.

Prime Minister Shehbaz Sharif confirmed the finalization of the deal via social media, thanking President Trump for his role in concluding what he called a “historic US-Pakistan trade agreement.” In a post on X (Twitter), Sharif wrote: “This landmark deal will enhance our growing cooperation so as to expand the frontiers of our enduring partnership in days to come.”

While full details of the agreement are yet to be released, analysts suggest the move is geopolitically significant, particularly as U.S. trade tensions with India continue to simmer. The energy partnership signals a notable realignment in South Asia’s economic landscape, with the U.S. potentially seeking to strengthen ties with Pakistan as a counterbalance to its increasingly complex relations with India.

This agreement comes as Pakistan continues to struggle with energy shortfalls, and U.S. firms look to tap into emerging markets with untapped resource potential. With American technological input and investment, the partnership could be a turning point for Pakistan’s domestic oil production.

Further updates are expected as implementation begins and specific corporate partners are announced.

Osemekemen

Ilumah Osemekemen is Editor at Newskobo.com. A Business Administration graduate, he produces researched content on business, tech, sports and education, delivering practical… More »

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