Oil sales jump 26pc to 14mln tons last month

KARACHI: Sales of petroleum products surged 26 percent year-on-year to 1.4 million tons in February as consumer demand was seen recovering back to the pre-COVID level, official data showed on Tuesday.

The off-takes of petroleum products stood at 1.1 million tons in February 2020. However, sales of petroleum products were down eight percent month-on-month partly due to two working days less in February compared to January.

“The growth in sales volumes was primarily attributable to resilience displayed by the economy and the ensuing demand for motor spirit, better agricultural yields resulting in higher sales of high speed diesel, absence of compressed natural gas at fuel stations and strict control on borders to control supply of illegal or dumped fuel from Iran,” said analyst Arsalan Hanif at Arif Habib Limited.

The growth trend was carried on from the last couple of months following the ease of lockdown related to coronavirus. Economic reopening led to fast recovery in activities. During 8MFY21 (July-February 2020/21), sale of petroleum products increased 13 percent to 12.6 million tons compared with 11.2 million tons in the corresponding period last year.

Major contribution to growth came from HSD and furnace oil as their off-takes jumped to 4.8 million tons and 2.1 million tons, up 15 percent and 36 percent against 4.2 million tons and 1.5 million tons in the same period last year.

Auto sales, driven by lower interest rates, also caused consumption of fuel. The interest rates came down 650 basis points to 7 percent in couple of months last year.

Pakistan State Oil (PSO) emerged as the best performer and posted a growth of 58 percent year-on-year in February 2021. “If we exclude PSO’s growth then February 2021 sales growth will come down from 26 percent to five percent,” Hanif added.

Shell Pakistan followed suit and registered a growth of 33 percent year-on-year. However, Attock Petroleum and Hascol posted a decline of 16 percent year-on-year.

During 8MFY21, PSO managed to expand its market share by 1.6 percent to 46.1 percent compared with 44.5 percent in 8MFY20.

New entrants are giving a tough time to existing players. Their overall market share increased 2.2 percent to 32.3 percent against 30.1 percent in same period last year.

Hascol, Attock Petroleum and Shell’s market shares dropped 1.8 percent, 1.6 percent and 0.5 percent to 4.7 percent, 9.1 percent and 7.8 percent, respectively in eight months.