A total of 137 petrol stations have been closed for breaches of licensing conditions, including fuel laundering, since 2011.

In that time more than 3 million litres of fuel have been seized and 31 fuel laundering operations or “oil laundries” have been detected and closed down.

Minister for Finance Michael Noonan also said industry sources were reporting a "much reduced incidence of laundered fuel on the market".

He added that “tax revenues are up 13 per cent compared with a couple of years ago”. Economic recovery had contributed to this growth but “reduced fraud is an important factor”.

The Minister also said there had been no fall in exchequer revenues from oil, diesel and petrol because of the reduction in oil prices.

Excise taxes are set at a fixed rate regardless of price and tax revenues rose €113 million last year.

He told Fine Gael TD Brendan Griffin (Kerry South) he was happy the Revenue Commissioners' strategy to deal with fuel laundering was the best course of action.

A new ‘marker’ to identify ‘green’ agricultural/industrial use diesel that has been laundered to sell as more expensive car fuel, will be introduced in Ireland and Britain at the end of March.

The Minister said he was confident it would “re-inforce the measures already implemented” to combat fuel fraud.

Mr Griffin asked if the Minister would review the green diesel system which he believed “provides enormous business potential for launderers”.

Mr Noonan rejected any changes including moving away from the current system of marking lower taxed fuels towards a system based on repayments to the users.

This would “impact on a wide range of users, would be costly to implement and would, itself, be at risk from fraud”.

He said marked gas oil had a wide variety of uses, including the propulsion of trains, in agricultural, construction and industrial machinery, for commercial sea-navigation (including fishing) and commercial and home heating purposes.

Changing the rebate system would “involve the establishment of an expensive and wide-ranging repayments system and would place a new administrative burden on oil traders, on the large number of users and the Revenue Commissioners”, he said.

“It would also impose significant cash-flow costs on those currently using marked gas oil.

“Repayment schemes are vulnerable to abuse and the introduction of a wide-ranging repayment scheme would not offer greater security against fraud than the current arrangements.

“Fuel in respect of which a repayment of duty was made could be easily diverted to on-road use.”

Given the progress made by Revenue in tackling fuel laundering “I am satisfied that the strategy being implemented by Revenue is the best course of action”.