Tuesday November 28, 2023

Petroleum products off-take drops 11pc on lower demand

January 04, 2023

KARACHI: Sale of petroleum products declined 11 percent in December during the current financial year on the back of lower demand, caused by multiple factors.

According to the data, Petroleum products sales settled at 1.33 million tonnes in December 2022 compared to 1.5 million tonnes in the same month of the last financial year.

Analysts attribute the slump in sales of petroleum products to higher petroleum prices, slowdown in economic activity, a decline in automobile sales, and lower furnace oil-based power generation.

Data showed that sale of motor spirit (petrol) reflected a fall of 11 percent YoY, to settle at 0.62 million tonnes in the month under review against 0.71 million tonnes in the corresponding month of the previous fiscal.

Similarly, high speed diesel (HSD)

volumes slumped by 15 percent YoY,

to clock in at 0.52 million tonnes in December 2022 against 0.61 million tonnes in the same month of the last financial year.

Sale of furnace oil dropped 3 percent YoY in the month under review, settling 0.123 million tonnes against 0.127 million tonnes in the corresponding month of last fiscal.

On month-on-month basis, petroleum sales decreased 14 percent during December of this fiscal.

Volumes of petrol, HSD, and furnace oil recorded a fall of 8 percent, 22

percent, and 10 percent MoM, respectively.

During the first half of the current financial year, sales of total petroleum products plunged by 19 percent YoY to 9.03 million tonnes compared to 11.10 million tonnes in the same period of last year.

Product-wise data showed a reduction in all categories as off-take of petrol, HSD and furnace oil settled at 3.83 million tonnes, 3.36 million tonnes, and 1.45 million tonnes, respectively.

Analyst Nasheed Malik of Topline Securities noted that oil sales were down in the first half of this fiscal due to economic slowdown with decline visible in all major petroleum products.

Higher prices of petrol and diesel have also had a major impact on demand, he added.

Company-wise data showed that Pakistan State Oil’s (PSO) sales showcased a fall of 9 percent YoY in December 2022, which was majorly contributed by a decrease in sales of diesel, petrol and furnace oil by 1 percent, 10 percent, and 93 percent YoY, respectively.

Similarly, YoY sales of Attock Petroleum Limited (APL), Hascol and SHEL declined by 16 percent, 16 percent, and 18 percent, respectively.

During the first Six months of this fiscal, PSO managed to expand its market share by 1.2 percent to 51.4 percent compared to 50.3 percent in 1HFY22.

Meanwhile, market share of APL and SHEL remained stable at 9.2 percent, and 7.5 percent YoY, respectively. Whereas, HASCOL’s market share in 1HFY23 improved to 1.8 percent.

However, the overall market share of other oil marketing companies declined to 30.1 percent, the data showed.