ISLAMABAD, October 30, 2026 — Pakistan has approved a tax-neutral bonded oil storage policy that would allow Saudi companies to establish commercial petroleum reserves in the country, as Islamabad seeks to expand energy cooperation with Riyadh.
Federal Minister for Petroleum Ali Pervaiz Malik outlined the policy during a meeting with Saudi Ambassador Dr Rajeh bin Tami Al-Baqami in Islamabad on Friday, according to an official statement issued by the Petroleum Division on October 30.
The framework is designed to facilitate commercial oil storage in Pakistan without local tax liabilities for participating Saudi companies. The government has drawn on arrangements used by international energy trading centres, including Fujairah and Singapore.
Officials discussed how storage facilities in Pakistan could provide additional options for managing petroleum shipments and supplying markets across Asia, particularly amid disruptions affecting major international shipping routes.
The meeting also covered plans for a petroleum storage and refining complex at Hub in Balochistan. The proposed development is being planned with technical guidance from Technip Energies UK and is intended to accommodate Very Large Crude Carriers.
The government sees the project as an opportunity to strengthen Pakistan’s position in regional petroleum trade and improve access to markets in Central Asia and China.
Malik also highlighted investment opportunities under Pakistan’s refinery upgradation programme, which aims to modernise domestic refining facilities and support the production of Euro 5-standard fuels.
The two sides discussed expanding crude oil procurement arrangements with Saudi Aramco and exploring dedicated liquefied petroleum gas shipments to Pakistan, particularly ahead of higher winter demand.
The petroleum minister thanked Saudi authorities for facilitating crude oil shipments through Yanbu port during recent disruptions in international energy markets.
The discussions formed part of broader efforts to strengthen commercial cooperation between Pakistan and Saudi Arabia in petroleum, mining and energy infrastructure.