Pakistan suffers an annual loss of approximately one billion dollars due to the smuggling of petroleum products.
According to a letter from the Oil Companies Advisory Council (OCAC) addressed to the Chairman of the Oil and Gas Regulatory Authority (OGRA), around 10 million litres of petroleum products are smuggled daily through land and sea routes, representing 20% of its annual consumption and resulting in significant financial losses to the national treasury.
The OCAC letter emphasizes the urgent need for the regulator to address the resurgence of smuggling, which threatens the viability of the country’s oil industry. The smuggling of high-speed diesel and motor spirit (MS) undercuts government revenue from legitimate sales. It impacts the entire supply chain, including white oil pipelines, refineries, and oil marketing companies (OMCs).
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Although a government crackdown a few months ago temporarily reduced the volume of smuggled petroleum products, the issue has intensified recently. The OCAC warns that without prompt and rigorous measures, the situation will likely deteriorate further, potentially leading to the shutdown of Pakistan’s domestic refining sector. The letter calls for immediate action to curb the influx of smuggled petroleum products and safeguard the country’s economic interests.
