Oil, Gas and Refinery Sectors - updates

[hydrabadi_arab]

OGRA moves to real-time digital tracking of petroleum stocks​

Regulator to link OMCs and refineries with Enterprise Resource Planning Systems and monitor stocks through Automatic Tank Gauging sensors



The Oil and Gas Regulatory Authority (OGRA) is developing a digital system to obtain real-time petroleum data directly from oil marketing companies (OMCs) and refineries through Enterprise Resource Planning (ERP) systems and monitor stock levels using Automatic Tank Gauging (ATG) sensors.

According to official documents, the initiative is aimed at improving the accuracy, reliability and timeliness of petroleum stock and supply data for better planning and monitoring of the supply chain.

OGRA has already developed the digital platform for supply-chain visibility, while integration of oil pipelines with ERP systems is under way and is expected to be completed by the end of September 2026.


A key milestone is the direct collection of data from OMCs and refineries through their ERP systems, along with stock positions generated through ATG sensors.

The system is expected to improve the quality and timeliness of information used to assess petroleum product requirements and monitor supply-chain operations.

Currently, OGRA monitors petroleum stock availability but does not have a dedicated real-time ERP system for tracking customs-bonded stocks.

Customs-bonded stocks, including duty-paid and non-duty-paid petroleum stocks, are managed by Pakistan Customs/Federal Board of Revenue (FBR) under the Customs Act, 1969.


The digitisation project will also facilitate FBR and Pakistan Customs by providing access to more timely petroleum stock data. OGRA has already provided FBR/Customs access to its digital platform.

Why Pakistan is doing this​

The primary drivers for this initiative are to end the "black market" for fuel and overcome the limitations of manual, fragmented reporting. Key reasons include:

• Curbing Smuggling and Theft: For years, Pakistan has struggled with massive leakages in its fuel supply chain. Intelligence reports have indicated that millions of liters of petroleum are smuggled into the country daily, leading to annual revenue losses estimated in the hundreds of billions of rupees.
• Moving Away from Manual Reporting: Currently, regulators rely on periodic, manual reports from oil marketing companies (OMCs) and refineries. This outdated method often leaves gaps in data, making it difficult to detect hoarding, artificial shortages, or illegal "off-the-books" inventory movements until a crisis has already occurred.
• Enhancing Regulatory Visibility: The system allows the Oil and Gas Regulatory Authority (OGRA) to gain an "end-to-end" view of the supply chain—from import and production to storage and final retail sale. It specifically addresses the need for better visibility into customs-bonded stocks, which are managed by the Federal Board of Revenue (FBR) and Pakistan Customs.
• Legal Empowerment: The initiative is supported by the Petroleum (Amendment) Act 2025, which amended the original 1934 law to formally authorize the use of IT-based systems for continuous monitoring and to grant enforcement agencies stronger powers to seize smuggled or illegally stored fuel.

What Pakistan expects to achieve​

The government expects this digital transformation to deliver several long-term benefits:

• Revenue Assurance: By tracking every liter of fuel, the government aims to plug leakages that currently cause massive losses in public revenue, helping to secure duties and taxes that were previously bypassed through illicit trade.
• Improved Supply Chain Management: Real-time data will allow for better demand planning and supply management. By identifying disruptions or inventory shortages as they happen, the government can intervene before they escalate into national supply crises.
• Market Transparency and Discipline: The system is expected to increase transparency across the industry, preventing market manipulation and ensuring that retailers and depots comply with licensing and storage regulations.
• Inter-Agency Coordination: By providing the FBR and Pakistan Customs direct access to this digital platform, the government expects to streamline enforcement. Authorities will be able to share information instantly, leading to more effective, coordinated action against fuel smugglers and those involved in adulteration.
• Foundation for Further Reforms: This digitization is seen as a logical step toward a more liberalized and efficient petroleum market, where data-driven regulation replaces administrative discretion.

 

[hydrabadi_arab]

Why Pakistan is doing this​

The primary drivers for this initiative are to end the "black market" for fuel and overcome the limitations of manual, fragmented reporting. Key reasons include:

• Curbing Smuggling and Theft: For years, Pakistan has struggled with massive leakages in its fuel supply chain. Intelligence reports have indicated that millions of liters of petroleum are smuggled into the country daily, leading to annual revenue losses estimated in the hundreds of billions of rupees.
• Moving Away from Manual Reporting: Currently, regulators rely on periodic, manual reports from oil marketing companies (OMCs) and refineries. This outdated method often leaves gaps in data, making it difficult to detect hoarding, artificial shortages, or illegal "off-the-books" inventory movements until a crisis has already occurred.
• Enhancing Regulatory Visibility: The system allows the Oil and Gas Regulatory Authority (OGRA) to gain an "end-to-end" view of the supply chain—from import and production to storage and final retail sale. It specifically addresses the need for better visibility into customs-bonded stocks, which are managed by the Federal Board of Revenue (FBR) and Pakistan Customs.
• Legal Empowerment: The initiative is supported by the Petroleum (Amendment) Act 2025, which amended the original 1934 law to formally authorize the use of IT-based systems for continuous monitoring and to grant enforcement agencies stronger powers to seize smuggled or illegally stored fuel.

What Pakistan expects to achieve​

The government expects this digital transformation to deliver several long-term benefits:

• Revenue Assurance: By tracking every liter of fuel, the government aims to plug leakages that currently cause massive losses in public revenue, helping to secure duties and taxes that were previously bypassed through illicit trade.
• Improved Supply Chain Management: Real-time data will allow for better demand planning and supply management. By identifying disruptions or inventory shortages as they happen, the government can intervene before they escalate into national supply crises.
• Market Transparency and Discipline: The system is expected to increase transparency across the industry, preventing market manipulation and ensuring that retailers and depots comply with licensing and storage regulations.
• Inter-Agency Coordination: By providing the FBR and Pakistan Customs direct access to this digital platform, the government expects to streamline enforcement. Authorities will be able to share information instantly, leading to more effective, coordinated action against fuel smugglers and those involved in adulteration.
• Foundation for Further Reforms: This digitization is seen as a logical step toward a more liberalized and efficient petroleum market, where data-driven regulation replaces administrative discretion.

Final nail in the coffin of Iranian smuggled oil. More official sales, more tax revenue.