In September 2023, Pakistan’s monthly oil sales through Oil Marketing Companies (OMCs) reached a record low of 1.06 million tons, a dramatic fall of 31% year over year and 25% month over month. Since the COVID-19 shutdown in March 2020, this decline has been at its lowest level.
Topline Securities claims that a number of variables, such as rising fuel costs, the entry of illicit oil from Iran, and the decreased usage of furnace oil (FO) for power production, were responsible for this fall.
Sales of FO were 0.97 million tons in September 2023, down 20 percent year over year and 24 percent month over month.
The total amount of oil sold in the first quarter of fiscal year 2024 (1QFY24) was 3.8 million tons, a 15% YoY decline. Sales of oil declined by 3.5 million tons YoY, or 1%, when FO was excluded.
Sales of high-speed diesel (HSD) fell to 394,000 tons in September 2023, the lowest level since the COVID shutdown in March 2020. These sales fell by 24% YoY and 28% MoM, mostly as a result of rising fuel costs. From Rs. 293 per liter in August 2023 to Rs. 330 per liter in September 2023, HSD prices increased by 12 percent.
Sales of Motor Spirit (MS) fell by 18% YoY and 23% MoM as well, hitting 518,000 tons in September 2023, the lowest level seen since March 2020. The considerable rise in gasoline prices, which went from Rs. 290 per liter in August 2023 to Rs. 331 per liter in September 2023, might be blamed for this decline.
Sales of FO, which totaled 84,000 tons in September 2023, fell by 72 percent YoY and 28 percent MoM. The main cause of this fall was a decrease in FO-based power production.
Among the listed companies, Pakistan State Oil (PSO) saw their sales for September 2023 drop by 510,000 tons, or 37 percent YoY and 30 percent MoM. Reduced sales were blamed for the reduction, with FO accounting for the largest share of it with a 94 percent YoY and 61 percent MoM decline.
Sales for Shell Pakistan (SHEL), which reached 80,000 tons, decreased by 30% YoY and 18% MoM. The sales of Attock Petroleum (APL), which totaled 123,000 tons, decreased by 18,000 MoM and 13 percent YoY.
The trading business predicts that improved border security measures and the recent drop in gasoline and diesel prices would help to strengthen oil sales in the next month.
