Pakistan petroleum sales climb up by 16 per cent in FY22

Pakistan petroleum sales climb up by 16 per cent in FY22

KARACHI: The domestic sales of petroleum products in Pakistan have jumped up by 16 per cent to 22,595 metric tons in fiscal year 2021/2022 when compared with the preceding year, a report said on Monday.

However, Pakistan oil sales declined by 11 per cent MoM to 1.9 million in June 2022 which is mainly driven by 14 per cent MoM dipped in MOGAS and High Speed Diesel (HSD) sales.

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“This was due to sharp increase in MOGAS and HSD prices by 31 per cent and 51 per cent in June 2022, respectively,” said analysts at Topline Securities Research.

This led to reduced demand of petroleum products and rise in usage of public transport/car pooling, they added.

On YoY basis, oil sales remained flat during the month of June 2022.

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MOGAS and HSD sales were down 12 per cent and 16 per cent on MoM basis to 702k tons and 713k tons, respectively. Excluding Furnace Oil (FO), overall petroleum sales volume stood at 1.48 million tons in June 2022, down 13 per cent MoM and 7 per cent YoY.

“In FY22, Pakistan’s oil sales clocked in at 22.6 million tons, up 16 per cent YoY, which was much better than the last 10-year growth rate,” the analysts said.

This was mainly led by higher than expected growth in Furnace Oil (FO) sales which reached 4 million tons (highest since FY18) due to high demand in power plants amidst non-availability of RLNG along with low hydel generation.

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Excluding FO, oil sales were up 13 per cent YoY in FY22 due to uptick in MOGAS and HSD sales.

Motor Gasoline (MOGAS) and High Speed Diesel (HSD) volumes witnessed jump of 9 per cent YoY and 15 per cent YoY to 8.9 million tons each in FY22. This was driven by (i) strong economic growth including growth in Agriculture sector, and (ii) increase in auto sales.

Pakistan State Oil (PSO) sales outperformed the sector growing by 29 per cent whereas Attock Petroleum (APL) sales improved by 22 per cent in FY22. Shell Pakistan (SHEL) and Hascol Petroleum (HASCOL) underperformed the market during FY22.

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Moving forward, we expect oil sales to decline by around 15 per cent YoY in the current fiscal year to due to (i) expected decline in auto sales in FY23, (ii) low growth estimated in agriculture sector (2.5 per cent for FY23F vs. 4.4 per cent in FY22), and (iii) sharp increase in petrol/diesel prices.

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