Pakistan to Launch Real-Time Digital Tracking System for Petroleum Products
Islamabad, August 2025 –
In a major move to curb smuggling, theft, and fuel adulteration, the Pakistani government will introduce a real-time digital tracking system for petroleum products within the next month.
The initiative, backed by the Petroleum (Amendment) Act 2025, aims to monitor every litre of fuel from import and production to storage, transport, and final sale. Authorities expect the system to significantly reduce annual revenue losses estimated at Rs. 300-500 billion.
Legal and Technical Framework
The amendment, approved by the National Assembly, updates the nearly century-old Petroleum Act 1934. It empowers authorities to deploy IT-based systems for continuous monitoring and strengthens enforcement by coordinating efforts across multiple agencies.
Key features include:
-
Digital tracking of petrol stations, transportation routes, and storage facilities
-
Seizure powers for deputy commissioners, assistant commissioners, and officers under the Customs Act 1969
-
Immediate closure and confiscation of smuggled fuel, illegal storage, or unlicensed facilities
Strict Penalties for Violations
The law introduces heavy fines and enforcement measures to deter illegal activities:
-
Individuals involved in illegal fuel activities: Rs. 1 million, repeat offenders: Rs. 5 million
-
Unlicensed facilities: Rs. 10 million fine plus confiscation of machinery and fuel
-
Smuggling operations: Rs. 100 million fine, immediate closure, and asset seizure
-
Vehicles used for smuggling will be confiscated under the Customs Act
Facilities with expired licences have a six-month grace period for renewal, with the Department of Explosives processing applications within 30 days. Failure to comply will result in sealing of premises, asset confiscation, and fines.
Addressing Rampant Smuggling
The reform comes after years of concern over fuel smuggling, which has cost the government billions annually. A 2020 inquiry estimated over Rs. 250 billion lost each year from Iranian fuel smuggling, while a 2024 report revealed 10 million litres of petrol and diesel enter Pakistan illegally daily. The investigation also identified 533 illegal petrol stations, 105 known smugglers, and collusion from multiple law enforcement agencies.
Trial and Appeal Process
The Sessions Court holds trial powers under the amended law, with administrative authority vested in deputy and assistant commissioners. Aggrieved parties can appeal to the High Court within 30 days of any decision.
The government and the Oil and Gas Regulatory Authority (OGRA) are coordinating with market stakeholders to ensure a smooth rollout of this end-to-end tracking system, aiming to safeguard revenue, improve compliance, and strengthen Pakistan’s petroleum sector.
