Karachi, September 17, 2023 – Pakistan’s import of petroleum products has seen a substantial decline of 41 percent during the first two months of the fiscal year 2023-24, according to official statistics released by the Pakistan Bureau of Statistics (PBS).
During the period of July to August in the fiscal year 2023-24, the import of petroleum products amounted to $971 million, a significant drop from $1.66 billion in the corresponding period of the previous fiscal year. Market experts have attributed this sharp decline in imports to multiple factors.
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One of the primary reasons cited for this decline is the decrease in domestic consumption due to record-high prices of petroleum products within the country. These elevated prices have likely deterred consumers and businesses from purchasing larger quantities of petroleum products, leading to reduced imports.
Another contributing factor to the decline in imports is believed to be the illegal influx of Iranian petroleum products into Pakistan. This parallel market of cheaper Iranian products has likely diverted business away from foreign suppliers.
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According to a research report by Arif Habib Limited, domestic sales of petroleum products have also witnessed a notable 7 percent decline during the first two months of the current fiscal year. Total sales were recorded at 2.76 million tons during July to August in fiscal year 2023-24, compared to 2.97 million tons during the same period in the previous fiscal year.
To combat the issue of smuggled petroleum products, the government has initiated a massive crackdown, claiming success in blocking many of the routes used for smuggling. This initiative may have contributed to the reduction in illegal imports.
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Furthermore, the fall in the import of petroleum products may also be linked to higher global prices, evident in the reduced imported quantity. During the first two months of the fiscal year 2023-24, the imported quantity of petroleum products stood at 1.59 million tons, a drop from 1.91 million tons in the corresponding period of the previous fiscal year.
Meanwhile, the import of petroleum crude experienced a staggering 50 percent decline, totaling $456 million during July to August in fiscal year 2023-24, compared to $904 million in the same period of the previous fiscal year.
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In summary, the overall import of petroleum products in Pakistan has witnessed a significant decline, with total imports in the petroleum group falling by 34.25 percent to $2.17 billion during the first two months of the current fiscal year, compared to $3.30 billion in the same period of the previous fiscal year. The reasons behind this decline are multifaceted, including high domestic prices, the influx of cheaper Iranian products, and the government’s efforts to curb smuggling.
