ECC approves bonded storage of imported petroleum products

According to Dawn, the federal government's Economic Coordination Committee, chaired by Finance Minister Muhammad Aurangzeb, has approved a policy allowing foreign fuel suppliers to set up bonded storage at their own cost in Pakistan. The move responds to recent supply problems tied to the Strait of Hormuz and covers storage for re-export as well as domestic sales. The guidelines, pending since June 2023, will take effect immediately once the federal cabinet ratifies them.

The policy covers crude oil, petrol, high-speed diesel, jet fuel, furnace oil, LPG and LNG, subject to Ogra product specifications and excluding sanctioned goods. Consignees will not need FBR sales tax registration for operating under the scheme, and sales tax on domestic sales will fall on the oil marketing company or refinery as importer of record at ex-bonding. Pricing for foreign suppliers' sales to local OMCs and refineries will be commercially negotiated and not subject to Ogra price notifications.

In a declared emergency, the government may requisition bonded stocks at the international market price, and consignees must report holdings to Ogra daily. The existing import regime for OMCs and refineries will continue unchanged alongside the new arrangement.