The Pakistani government has proposed a significant amendment to the 1934 Petroleum Act, aiming to implement a digital tracking system for petroleum products from importation to retail distribution. This initiative seeks to address the substantial revenue losses, estimated between Rs300-500 billion annually, resulting from fuel smuggling and adulteration.
Petroleum Minister Ali Pervaiz Malik’s Petroleum (Amendment) Act, 2025, describes how information technology can be used to track petroleum products in real time. The proposed system will track storage facilities, petrol stations, and transportation vehicles, enabling coordinated actions among government agencies to curb illegal activities.
The draft law grants authorities the power to confiscate petroleum products, equipment, and storage facilities involved in illegal operations. Facilities operating without legal licenses may be sealed, and violators may be fined up to Rs100 million. Additionally, the act designates sessions courts for swift legal proceedings and allows for appeals in high court.
This legislative move responds to longstanding demands from local refineries and oil marketing companies for stricter measures against fuel smuggling, particularly from neighboring countries. A 2020 inquiry revealed that over Rs250 billion worth of petroleum products were smuggled annually, predominantly from Iran, highlighting the urgency for effective regulatory mechanisms.
