Pakistan temporarily eases oil import rules to safeguard energy supplies

The State Bank of Pakistan on Wednesday temporarily allowed the import of crude oil and petroleum products on a CIF (Cost, Insurance and Freight) basis for 60 days, citing uncertainty arising from the ongoing Iran war and the strategic importance of maintaining energy supplies.

In a circular issued to authorized dealers and commercial banks, the central bank directed them to take note of the temporary policy relaxation under Para 5, Chapter 13 of the Foreign Exchange Manual, which outlines permissible Incoterms for imports into Pakistan.

According to the SBP, the decision was taken in light of the prevailing geopolitical situation and the need to ensure an uninterrupted supply of crude oil and petroleum products.

“In view of the prevailing situation and the critical importance of crude oil and petroleum products for the country, it has been decided to allow import of crude oil/petroleum products on CIF basis for a period of sixty (60) days from the date of issuance of this circular,” the bank said.

Under CIF arrangements, the seller is responsible for the cost, insurance and freight of goods until they reach the destination port, shifting some logistical and insurance risks away from the buyer.

The temporary approval is expected to help Pakistani oil importers manage shipping and insurance challenges during the current geopolitical tensions, while reducing the risk of supply disruptions in the domestic market.

Energy imports remain a crucial component of Pakistan’s economy, with the country heavily reliant on imported crude oil and refined petroleum products to meet its energy needs.