Fuel smugglers earn 20 sen a litre

By THE STAR | 19 October 2019

PETALING JAYA: A price difference of just 20 sen per litre is all it takes to encourage smuggling of fuel to neighbouring countries.

Sources familiar with the scourge said this would be done in a few ways.

One said that by land, smugglers would use modified vehicles, pick-up trucks or tankers.

“These are modified vehicles with extra tanks, ” he told The Star yesterday.

“They go across the border multiple times a day. Smugglers also smuggle fuel through tankers and transfer the fuel across the border to another tanker.”

According to GlobalPetrolPrices.com, as of yesterday, petrol costs RM4.78 a litre in Thailand while in Indonesia it costs RM2.94.

For diesel, Thailand charges RM3.52 a litre while in Indonesia it costs RM3.60.

In Malaysia, the fuel price for RON95 and diesel cost RM2.08 a litre and RM2.18 per litre respectively for the week beginning today until Oct 25.


Sources said there were also cases where fuel depots were configured wrongly, which resulted in more of the pricey liquid being dispensed.

“What happens is that you’ll have people who take up the excess fuel. So, on a daily basis they’ll accumulate enough fuel and then sell it, ” sources said.

Some of the middlemen who help manage petrol stations are the culprits who smuggle fuel out of the country.

“They manage the station on behalf of the petrol station companies. They have their own trucks and they do the ordering on behalf of the stations under them, ” said a source.

“What happens is that these people under-declare their sales. They put in a higher order but the petrol stations do not get the order and the additional fuel is smuggled elsewhere.”

Sources said fuel smuggled through international waters on ships constitutes the most rampant smuggling method.

For Sabah and Sarawak, fuel is sent to rural areas in drums due to accessibility problems for fuel tankers. These drums are sometimes lost to smugglers.

“The bigger the price difference between the world and our pump price, the more will be smuggled, ” said a source there.

“Even with a 20 sen to 50 sen difference, it is already a good margin for all involved.”

To combat the smuggling of petrol, they said the stock management system at stations and fuel depots have to be digitalised.

“There is a need to reconcile the fuel going in and out. Right now, Malaysia does not even have automatic tank gauging.

“We are still using a World War II dip stick method to see the quantity – and this is not accurate, ” said a source, adding that Malaysia should emulate Turkey’s system of fuel regulation to combat smuggling.