In September 2023, the sales of petroleum products in Pakistan took a significant hit, declining to 1.06 million tons. This represented a substantial year-on-year (YoY) drop of 31% and a month-on-month (MoM) decrease of 25%, marking the lowest level since the COVID-19 lockdown in March 2020.
Several factors contributed to this decline. Firstly, record-high fuel prices weighed heavily on consumer demand. Additionally, the illegal smuggling of oil from neighboring Iran had an adverse impact on the legitimate market. Furthermore, lower usage of Furnace Oil (FO) for power generation played a role in the reduced sales.
Specifically, FO sales amounted to 0.97 million tons in September 2023, down 20% YoY and 24% MoM. Over the first quarter of the fiscal year 2024, total oil sales reached 3.8 million tons, reflecting a 15% YoY decrease. Excluding FO, oil sales decreased by 1.0% YoY to 3.5 million tons.
High-Speed Diesel (HSD) sales suffered a sharp decline, reaching 394,000 tons in September 2023. This represented a 24% YoY decrease and a 28% MoM drop. Rising diesel prices, which surged from Rs 293 per liter in August 2023 to Rs 330 per liter in September 2023, were a significant factor.
Sales of Motor Spirit (MS), commonly known as petrol, also saw an 18% YoY and 23% MoM decline, totaling 518,000 tons in September 2023. The substantial increase in petrol prices, rising by 14% from Rs 290 per liter in August 2023 to Rs 331 per liter in September 2023, contributed to reduced demand.
Furnace Oil (FO) sales for September 2023 plummeted by 72% YoY and 28% MoM, reaching 84,000 tons, primarily due to decreased FO-based power generation.
Pakistan State Oil (PSO) experienced a 37% YoY and 30% MoM decline in sales for September 2023, totaling 510,000 tons. This was primarily driven by reduced sales across all sectors, with FO being the major contributor, experiencing a staggering 94% YoY and 61% MoM decline. Shell Pakistan (SHEL) saw a 30% YoY and 18% MoM decrease in sales to 80,000 tons, while Attock Petroleum (APL) recorded a 13% YoY and 18% MoM decline, with sales totaling 123,000 tons.
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