Friday September 29, 2023

Fuel oil stocks dwindle as power demand surges in summer

By Our Correspondent
September 05, 2023

KARACHI: Fuel oil stocks have halved in the last three months as domestic power plants increased their consumption and exports picked up, industry data showed on Monday.

The local refineries have around 105,000 tons of fuel oil currently, compared to 220,000 tons of fuel stocks three months ago.

"The fuel oil stocks have halved with the refineries in the three months due to the summer season in the country, which triggered the power demand in the country, especially in Punjab and Sindh, the two most populous provinces of the country," an industry offcial said.

He added that fuel oil, despite being low on the priority list of sources to produce electricity, has seen substantial consumption. "The situation has come to the point that whatever fuel oil is being produced by the refineries is largely being lifted by the power plants, and very low stocks of fuel oil have been left with the refineries."

Industry offcials said Pak Arab Refinery Limited (PARCO), being the largest refinery of the country, has the majority of the total stock of fuel oil and is in the process of shipping it to the foreign market soon. They pointed out that local refineries held over 219,000 tons of fuel oil. PARCO alone had a substantial stock of approximately 100,000 tons, followed by PRL with over 55,000 tons, National Refinery Limited with over 35,000 tons, Attock Refinery Limited with over 23,000 tons, and Cnergyico with 5,000 tons of fuel oil stocks by the end of May this year.

However, the situation has changed rapidly. The country currently has around 105,000 tons of fuel, and the largest chunk of 76,000 tons of fuel oil is being held by PARCO, which is in the process of exporting it in the coming days.

On the other hand, Attock Refinery Limited is currently possessing 14,000 tons of fuel, while National Refinery Limited has been carrying only 6,000 tons of stock. Pakistan Refinery Limited has been left with only 47,000 tons of stock, and Cnergyico has been carrying only 4,500 tons of fuel stocks.

They said although the situation is quite satisfactory for the local refining sector after their fuel oil is being lifted steadily, the demand for fuel oil is believed to dampen after two or three weeks after the summer season in Punjab comes to an end.