Oil sales in Pakistan touch four-year low
Oil sales during July to September of the current fiscal year amounted to 4.751 million tons.
KARACHI (Dunya News) - Oil sales in the first quarter of fiscal year 2018-19 slumped by 33 percent, touching four years low mark because of sharp decline in furnace oil volume due to the government’s move to use cheaper fuel like RLNG and coal.
Oil sales during July to September of the current fiscal year amounted to 4.751 million tons, showing a decline of 33 percent. While product wise data revealed that furnace oil sales during the period declined by 67 percent to 848,000 metric tons, while petrol down by 2 percent to 1.896 million metric tons and high speed diesel by 19 percent to 1.826 million tons.
According to a report prepared by Topline Securities during September 2018, oil sales posted decline of 21 percent to 1.763 million metric tons due to sharp decline of 61 percent in furnace oil amidst availability of alternative power generation sources RLNG and coal.
In August this year, oil sales went down by around 46 percent when compared with August of 2017, the report said. On the other hand, sales of diesel and petrol posted growth of 5 percent each, better than last month as August 2018 MS/HSD went down by 11 percent and 38 percent on account of restrained buying by dealers/pump owners as Government was claiming to reduce POL prices.
Syed Humaira Akhtar, analyst from BMA Capital Management, said that the furnace oil market dynamics seem to be on a mend where, along with the significant drop in sales volume (down 60 percent in September 2018), the customer base is shifting gradually towards cash-based customers.
Moreover, increasing market share of smaller players has dented the share of PSO. In first quarter of FY19, Attock Petroleum and HASCOL have largely dominated the furnace oil market (though still remain far from top position) with 9/13 percentage points jump in petrol to 16 percent and 19 percent respectively.
She said that that the two key triggers to watch out for include development on: (i) diesel deregulation process, and (ii) circular debt (partial relief likely).
Details by Haris Zamir
