Oil Price on 13th August reported that oil smuggling has been a problem for the Philippine government for decades, with both the transfer of oil cargoes from one vessel to another offshore and so-called “technical” smuggling. With rising global oil prices smugglers are once again active. With direct smuggling, it says that some oil companies actually bring in vessels, dock in small ports, and discharge the fuel directly to waiting tanker trucks who then deliver to service stations. Some of the largest oil refining companies in the Philippines have at one time of another been accused of engaging in direct smuggling. Technical smuggling usually involves the import of oil products being declared as another less valuable product, with lower duties collected, sometimes involving the bribery of customs officials. The government uses fuel-marking programmes, using advanced technology molecular markers and sophisticated management systems to mitigate tax evasion and subsidy abuse, minimise financial losses, and raise revenue. A recent Asian Development Bank (ADB) report said that all countries are susceptible to fuel fraud, but for developing countries fuel fraud can substantially reduce a government’s total revenues. The report said that oil smuggling costs the Philippine government around $750 million a year in lost revenue. On 8th August, the Philippines announced a team to oversee the implementation of its new fuel marking programme.
ASIAN DEVELOPMENT BANK: FUEL-MARKING PROGRAMMES: HELPING GOVERNMENTS RAISE REVENUE, COMBAT SMUGGLING, AND IMPROVE THE ENVIRONMENT
The ADB report, mentioned in relation to the Philippines’ fuel smuggling problems, dates from 2015, and can be accessed here –