Karachi, October 2, 2023 – Pakistan’s domestic sales of petroleum products experienced a significant decline, plummeting by 34 percent year on year (YoY) in September 2023, according to a report by the research team at Arif Habib Limited.
The total petroleum sales for the month were recorded at 1.01 million tons, a stark contrast to the 1.52 million tons sold in the same month of the previous year.
Several factors contributed to this sharp decline in petroleum sales. Firstly, higher prices of petroleum products, including petrol and high-speed diesel, placed a burden on consumers. Secondly, a slowdown in the economy, a decrease in automobile sales, and reduced reliance on furnace oil (FO)-based power generation due to the addition of new local coal-based power plants also played a role in the reduced demand for petroleum products.
Breaking down the numbers, the sales of petrol saw an 18 percent decline in September 2023, reaching 0.52 million tons. Similarly, high-speed diesel sales plummeted by 24 percent YoY, settling at 0.39 million tons in the same month. Meanwhile, FO sales experienced a dramatic decline of 72 percent, totaling 0.08 million tons in September 2023.
On a month-on-month (MoM) basis, petroleum sales fell by 28 percent in September 2023, primarily due to an increase in petrol and high-speed diesel prices, as well as a decline in FO-based power generation. Specifically, petrol and high-speed diesel sales dropped by 23 percent and 28 percent MoM, respectively, while FO offtake decreased by 28 percent MoM.
For the first quarter (July – September) of fiscal year 2023-24, total petroleum product sales reported a YoY decline of 16 percent, with sales amounting to 3.77 million tons compared to 4.49 million tons during the same period the previous year. This decline was observed across all categories, with petrol, high-speed diesel, and FO offtake registering at 1.85 million tons, 1.44 million tons, and 0.35 million tons, respectively.
A company-wise analysis revealed that Pakistan State Oil (PSO) experienced a 37 percent YoY reduction in offtake in September 2023, attributed to decreased sales of petrol, high-speed diesel, and FO by 13 percent, 23 percent, and a staggering 94 percent, respectively. Likewise, Hascol Petroleum, Attock Petroleum, and Shell Petroleum saw slumps of 12 percent, 13 percent, and 30 percent YoY in dispatches, respectively.
On a cumulative basis, petroleum sales of PSO, Shell, and Attock Petroleum declined by 19 percent, 16 percent, and 7 percent YoY, respectively, during the first quarter of fiscal year 2023-24. In contrast, Hascol Petroleum’s offtake exhibited a healthy growth of 35 percent YoY during the same period.
During July – September 2023-24, PSO’s market share dropped by 1.7 percent to 50.8 percent compared to 52.4 percent in the corresponding quarter of the previous year. Meanwhile, the market share of Shell remained stable at 7.2 percent YoY. Additionally, the market share of Attock Petroleum and Hascol Petroleum increased to 10.8 percent (from 9.7 percent in the same period last year) and 2.7 percent (from 1.7 percent in the same period last year), respectively. The market share of other Oil Marketing Companies (OMCs) remained constant at 28.5 percent in the first quarter.