KARACHI: Overall petroleum products sales in September declined 2 percent on yearly basis to 1.52 million tons, data issued by the Oil Companies Advisory Committee (OCAC) suggests on Friday.
“The decline came, as the demand for major retail fuels, ie, motor spirit (MS) and high-speed diesel (HSD) each fell by 8.0 percent on sequential basis,” Ali Zaidi of JS Global Capital said. However, strong furnace oil (FO) demand from the power sector limited the overall monthly decline in petroleum products sales.
“September 2020 saw the highest monthly sales in FO since July 2018,” Zaidi added.
Government had ordered a ban on the import of furnace oil in
December 2018, but the Pakistan State Oil (PSO) was granted an exemption because of its long-term furnace oil supply contract with the K-Electric.
Local refineries protested over the government decision of ban. However, after protests, the government notified a complete ban on import of furnace oil in January 2019.
Later in July 2020, the government formally lifted a ban on the import of furnace oil to meet peak electricity demand in the country, including Karachi.
“Strong FO sales are likely to prevail in the coming months, as FO-based generation continues due to gas supply issues,” Zaidi said.
Meanwhile, Pakistan State Oil increased its market share of MS to 43 percent, HSD to 49 percent and FO to 54 percent during the first quarter of the current fiscal year.
Attock Petroleum Limited (APL) contributed 7 percent to the total MS and HSD market, while its share in the FO segment clocked in at 19 percent.
However, petroleum products sales increased 8 percent on yearly basis in the first quarter of the current fiscal year to 4.74 million tons.
