Fuel smuggling puts Pakistan’s oil refineries at risk, OCAC warns

Islamabad: The rampant smuggling of petrol and diesel has become a critical threat to Pakistan's oil industry, with the Oil Companies Advisory Council (OCAC) warning of potential refinery shutdowns if the illegal trade continues unchecked.

In a letter to the Oil and Gas Regulatory Authority (OGRA) and the Ministry of Petroleum, the OCAC warned that the growing influx of smuggled oil could force domestic refineries to shut down permanently.

The OCAC noted that while anti-smuggling efforts had shown some success a few months ago, recent reports indicate a resurgence in illegal oil trafficking.

The letter revealed that an estimated 10 million liters of smuggled petroleum products are being consumed daily, making up 20 percent of the country's total petroleum usage.

The impact is already being felt, with petrol and diesel sales down by 5 percent, according to the OCAC. Smuggled oil is now being openly sold in major cities like Islamabad, Rawalpindi, and Peshawar.

The OCAC also highlighted the financial damage, with the national exchequer losing about one billion dollars annually due to this illegal trade. This ongoing smuggling could also deter foreign investment in the country's oil sector.

The OCAC has urged the government to take immediate and effective measures to curb petroleum smuggling and protect the domestic oil industry.