Iranian Oil Smuggling into Pakistan Drops by Over 60% Amid Regional Conflict

The smuggling of Iranian oil into Pakistan has seen a significant decline over the past six weeks. According to industry sources, this reduction is estimated at around 60%. The decrease in smuggling activity can be attributed to multiple oil tankers being destroyed in Balochistan, resulting in substantial losses for smuggling networks.

The conflict between Iran and the US-Israeli alliance had led to a surge in global crude oil prices, reaching above $100 per barrel. This increase in demand for cheaper fuel had fueled the smuggling of Iranian petroleum products into Pakistan. However, with the destruction of at least six oil tankers transporting fuel from Iran, the flow of smuggled fuel has now declined.

Pakistan's government had long urged authorities to curb the illegal trade, which has persisted for years. The country's petroleum import bill stood at $16.86 billion in FY2025-26, accounting for nearly 22% of its total import bill. Industry estimates suggest that Pakistan's illegal trade with Iran exceeds $2 billion annually.