The announcement was made by Pol Gen Somyos Phumphanmuang, a deputy police chief in charge of oil smuggling suppression, Capt Kongkiat Thong-aram, commander of a marine police patrol unit, and Sommai Wichianchan, deputy governor of Chanthaburi.
The operation was launched at 8pm on Saturday night on a boat pier involving the use of marine police and navy patrol boats. It followed several months of intelligence gathering.
Four boats modified for oil smuggling were seized and 11 suspects arrested. The suspects were identified as a Thai boat skipper, Chaiyan Suksa-nguan, 45, of Laem Sing district of Chanthaburi, and 10 Cambodian crewmen.
About 240,000 litres of diesel oil was seized from one of the boats.
Mr Chaiyan allegedly confessed to have smuggled diesel to the pier many times for sale to fishermen operating along the Chanthaburi and Trat coastlines. He said he was paid 30,000 baht for each delivery.
Pol Gen Somyos said the government had allowed diesel oil, free of customs and exise taxes, to be sold to off-shore fisherman in the sea 12 nautical miles from the shore.
Sale of untaxed oil onshore is illegal, he said.