KARACHI: The State Bank of Pakistan (SBP) on Wednesday allowed the import of crude oil and petroleum products on Cost, Insurance and Freight (CIF) basis for a period of 60 days, in a move aimed at facilitating timely supplies amid volatility in global oil markets.
In a circular issued to authorized dealers, the SBP said the decision had been taken in view of the prevailing global situation and the critical importance of crude oil and petroleum products for the country.
“Attention of Authorized Dealers is drawn towards Para 5, Chapter 13 of the Foreign Exchange Manual, which specifies permissible Incoterms for import of goods into Pakistan,” the SBP said.
Under existing instructions of the Foreign Exchange Manual, imports into Pakistan are generally allowed on Free on Board (FOB), Free Carrier (FCA), Free Alongside Ship (FAS), Cost and Freight (CFR) and Carriage Paid To (CPT) basis.
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However, citing volatility in international oil prices and limited import options in the global market, the central bank has temporarily allowed the import of crude oil and petroleum products on CIF basis.
“In view of the prevailing situation and 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,” the circular said.
However, the SBP has clarified that the facility would remain available for sixty days from the date of issuance of the circular.
The SBP has advised the authorized dealers to inform their clients about the revised instructions and ensure strict compliance.
Industry experts welcomed the move, terming it a timely step to ensure uninterrupted availability of petroleum products and crude oil in the country.
They said the permission to import on CIF basis would provide greater flexibility to local buyers and importers, allowing them to secure cargoes more quickly and avoid potential delays in shipments.
They said that under CIF arrangements, Pakistani importers could purchase entire tankers of petroleum products or crude oil with freight and insurance included in the contract, making procurement easier during periods of market uncertainty.
The CIF rule applies to sea or waterway transport, under which the seller bears the cost of freight and insurance up to the buyer’s designated port. However, the risk transfers to the buyer once the goods are loaded onto the vessel. The arrangement covers shipping and insurance but excludes import duties, while the buyer may claim compensation from the seller’s insurer if the cargo is damaged during transit.
In contrast, FOB (Free on Board) means the seller transfers ownership and liability of the goods to the buyer once the cargo is loaded onto the vessel at the port of shipment.
Copyright Business Recorder, 2026
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