Pakistan Witnesses 9% Dip in Petroleum Sales During 11MFY24

Pakistan Witnesses 9% Dip in Petroleum Sales During 11MFY24 — Pakistan has recorded a 9 percent decline in petroleum sales during the first 11 months (July–May) of the fiscal year 2023-24 compared to the same period in the previous fiscal year.

Analysts at Arif Habib Limited reported that total sales of petroleum products dropped to 13.83 million tons from 15.26 million tons, reflecting a significant year-on-year (YoY) decrease.

The breakdown of product-wise sales shows a fall across all categories. Petrol sales declined to 6.44 million tons, High Speed Diesel (HSD) to 5.69 million tons, and furnace oil (FO) to 0.94 million tons.

However, May 2024 saw a notable recovery with petroleum product dispatches reaching 1.39 million tons, a nine-month high, marking a 7% YoY increase. This growth is attributed to the revival of economic activities and a low base effect from the previous year. Petrol sales in May 2024 increased by 1%, settling at 0.61 million tons. HSD dispatches rose significantly by 18% YoY to 0.64 million tons. Conversely, FO sales volumes decreased by 24% YoY, amounting to 0.07 million tons.

On a month-on-month (MoM) basis, petroleum sales grew by 26% in May 2024. The increase was driven by several factors: a decline in the prices of Motor Spirit (MS) and HSD, peak harvesting season boosting HSD consumption, and higher demand for FO-based power generation with the onset of the summer season. MS sales climbed by 14% MoM, HSD offtake surged by 37% MoM, and FO dispatches rose by 2.3 times compared to the previous month.

Company-wise, Pakistan State Oil (PSO) saw its sales increase by 11% YoY in May 2024, fueled by a 3% rise in MS, 15% in HSD, and 42% in FO. Shell Pakistan Limited (SHEL) and Attock Petroleum Limited (APL) also reported YoY sales increases of 13% and 14% respectively in May 2024. In contrast, HASCOL Petroleum Limited experienced a 39% YoY decline in sales volumes.

During the 11-month period of FY24, petroleum sales for HASCOL, APL, PSO, and SHEL grew by 3%, 4%, 10%, and 13% YoY respectively. Despite the growth in sales, PSO’s market share fell slightly by 0.3% to 49.9% from 50.2% in the same period last fiscal year. SHEL’s market share also declined by 0.3%, reaching 7.3% YoY. Conversely, the market shares of APL and HASCOL increased to 10.0% (from 9.4% in SPLY) and 2.5% (from 2.4% in SPLY) respectively. Meanwhile, other Oil Marketing Companies (OMCs) saw their market share decrease by 0.12%, arriving at 30.2% in 11MFY24.

The overall dip in petroleum sales underscores the challenging economic environment and fluctuating market dynamics in Pakistan energy sector. As the fiscal year draws to a close, stakeholders will be closely monitoring these trends to inform future strategies and policies.