KARACHI: The State Bank of Pakistan (SBP) has allowed the import of crude oil and petroleum products on a Cost, Insurance and Freight (CIF) basis for 60 days to facilitate supplies amid volatility in global oil markets.
In a circular issued to authorised dealers, the central bank said the temporary measure had been taken in view of the global situation and the importance of crude oil and petroleum products for the country’s energy needs.
The SBP directed authorised dealers to note that existing instructions under the Foreign Exchange Manual generally permit imports into Pakistan on Free on Board (FOB), Free Carrier (FCA), Free Alongside Ship (FAS), Cost and Freight (CFR) and Carriage Paid To (CPT) terms.
However, citing fluctuations in international oil markets and limited import options, the central bank said crude oil and petroleum products could temporarily be imported on a CIF basis.
According to the circular, the permission will remain valid for 60 days from the date of issuance. Authorised dealers have been instructed to inform their clients of the revised arrangement and ensure compliance with the guidelines.
Industry participants said the decision would provide importers with greater flexibility in securing petroleum cargoes during periods of market uncertainty.
Under CIF arrangements, the seller covers freight and insurance costs up to the buyer’s designated port, while the risk transfers to the buyer once the goods are loaded onto the vessel.
In contrast, under FOB terms, ownership and risk transfer to the buyer when the cargo is loaded at the port of shipment.
