Oil sales jump 19 percent in October as prices drop

KARACHI: Oil sales in Pakistan rose 19 percent month-on-month to 1.3 million tonnes in October, as consumers took advantage of lower prices and filled up their tanks, a brokerag house report said on Thursday.

Excluding furnace oil, which is used for power generation, sales increased 24 percent from September. The monthly jump in sales was due to a low base of the previous month, when higher prices deterred demand and consumers waited for a decline in prices, brokerage Topline Securities said. The average price of petrol in October was Rs303 per liter, down from Rs318 in September. The average price of diesel was Rs311 per liter, down from Rs321.

However, on a year-on-year basis, oil sales in October fell 24 percent, while ex-furnace oil sales dropped 17 percent. The report attributed the annual decline to higher fuel prices and economic slowdown.

Furnace oil sales plunged 74 percent year-on-year and 37 percent month-on-month to 54,000 tonnes in October, due to lower furnace oil-based power generation. The country shifted to coal-based power plants.

In the first four months of the fiscal year 2024, which started in July, total oil sales reached 5.1 million tonnes , down 17 percent from the same period last year. Ex-furnace oil sales were down by just 6 percent to 4.7 million tonnes.

The average price of petrol in the four-month period was Rs290 per liter, up 25 percent year-on-year. The average price of diesel was Rs293 per liter, up 19 percent. Among the listed oil marketing companies, Attock Petroleum Ltd. saw its sales decline 10 percent year-on-year and increase 1 percent month-on-month to 124,000 tonnes in October. Furnace oil sales fell by 53 percent year-on-year and 39 percent month-on-month.

Pakistan State Oil Co., the largest oil marketer in the country, recorded a 26 percent year-on-year and a 23 percent month-on-month increase in sales to 628,000 tonnes. Furnace oil sales plummeted 95 percent year-on-year and 55 percent month-on-month. The company's market share stood at 50 percent in October, compared to 51 percent a year ago and 48 percent in September.

Shell Pakistan Ltd. registered a 30 percent year-on-year and a 12 percent month-on-month rise in sales to 90,000 tonnes. Diesel sales fell by 36 percent year-on-year and rose by 28 percent month-on-month, contributing the most to the company's sales.

Hascol Petroleum Ltd. was the only company that posted an increase in sales, with a 19% growth in October.

For the fiscal year 2024, Topline Securities expects a potential recovery in ex-furnace oil sales, estimated to increase by up to 5 percent. This is mainly driven by a pickup in economic activity, where interest rates are expected to decline in the latter half of the fiscal year, coupled with a favorable agricultural crop this year.