Karachi, January 23, 2024 – The second quarter of the fiscal year 2023-24 may witness a dip in profitability for Oil Marketing Companies (OMCs) in Pakistan, primarily due to anticipated inventory losses.
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No letup in challenges for oil marketing companies: analysts
KARACHI: Oil marketing companies (OMCs) are currently confronted with several challenges that are unlikely to abate anytime soon.
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Pakistan oil sales jump up by 26% in August
KARACHI: Pakistan’s domestic oil sales have jumped up by 26 percent to 1.97 million tons, which is the highest since May 2018.
Analysts at Topline Securities said that oil sales are also up 1 percent Month on Month (MoM), whereas oil sales during the first two months of the fiscal year 2021/2022 clocked in at 3.9 million tons, up 22 percent YoY.
Furnace oil sales improved by 63 percent YoY to 0.5 million tons in Aug-2021 primarily led by rising LNG prices and shortage in world LNG supply which is an alternative fuel for FO.
Growth in oil sales is also fueled by economic recovery as last year’s sales were mainly impacted by lockdowns and economic slowdown.
Consequently, MOGAS (MS) and High-Speed Diesel (HSD) sales are up 6 percent YoY and 32 percent YoY, respectively. Strong auto sales have also led to growth in these categories during the period under review.
Company-wise data shows that Pakistan State Oil (PSO), Attock Petroleum (APL) and Shell Pakistan (SHEL) have gained in terms of their market share.
PSO posted growth of 36 percent YoY as its oil sales clocked in at 1.0 million tons. PSO’s FO sales have jumped by 80 percent YoY as its market share in this segment improved to 66 percent in Aug-2021 vs. 60 percent in Aug-2020.
APL’s oil sales also improved by 56 percent YoY to 0.2 million tons, whereas SHEL’s sales are up 28 percent YoY to 0.1 million tons.
HASCOL witnessed a decline of 76 percent YoY in Aug-2021 as it continues to lose its market share as it stands at just 1 percent compared to 10 percent 3-years back.
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Customs invites OMCs for auction of POL products on December 22
ISLAMABAD: Directorate General of Intelligence and Investigation. Customs, Multan has announced auction of huge quantity of POL products on December 22, 2020 at the directorate office.
The directorate will auction POL products, included: High Speed Diesel (HSD) 295,200 liters; Kerosene Oil 111,630 liters; and base oil 94,200 liters.
The directorate said that the quotations for the auction had been invited only from Oil Market Companies (OMCs) to purchase the same on as is where is basis.
The successful bidder shall pay 10 percent withholding tax of the accepted bid amount of the auctioned subject POL products.
It said that the sealed tenders/offers must be received up to 1:00PM on December 22, 2020. The tenders/offers shall be opened at 2:00PM on the same day by the competent authority in the presence of all the participants.
The highest tender/offer shall be considered for processing of the case and submit to the competent authority in terms of Rule 73 of Customs Rules. In case of acceptance of the offer by the competent authority under aforementioned rules, rest of the amount shall be paid by the successful bidder within a period of seven days under Rule 68 of the Customs Rules.
In case of rejection of the bid earnest money shall be refunded to the bidder under Rule 74 of Customs Rules.
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FIRs lodged against two OMCs for black marketing
ISLAMABAD: Authorities on Tuesday initiated legal action against Oil Marketing Companies (OMCs) for indulgence in hoarding of petroleum products (POL) and creating artificial shortage.
At least two FIRs have been lodged against OMCs including Hascol Petroleum Limited and Gas & Oil Pakistan Limited for their involvement in black marketing of petroleum products.
A team of ministry of energy (petroleum division) inspected various OMCs terminal at Kaemari Karachi on Tuesday. The team observed hoarding / black marketing by the OMCs.
Sources said that the FIRs had been lodged against the Chief Executive Officers (CEOs) of the OMCs.
In latest development the Oil and Gas Regulatory Authority (OGRA) decided to undertake inspection of all oil depots in the country from Wednesday i.e. June 10, 2020.
There are 22 oil depots in the country. Around 22 teams of OGRA and HDIP will inspect the depots.
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Petroleum division recommends termination of dealers license on failure to maintain stock
ISLAMABAD: Petroleum Division has recommended termination of dealers licenses for failure to ensure sufficient stock for their respective Oil Marketing Companies (OMCs).
The petroleum division is cognizant of the artificial shortage of POL products that is being created in the country by opportunist OMCs and petrol dealers, a statement said on Thursday.
The petroleum division emphatically states that there is sufficient quantity of petrol stocks in the country.
Additional production by refineries as well as planned imports are on schedule to meet the monthly needs.
It is unfortunate that some OMCs and/or their dealers have resorted to such methods for profit maximization that are having an adverse impact on the lives of the esteemed consumers.
Petroleum Division has asked OGRA to take action against the OMCs who are not maintaining the required stocks or whose pumps are dry.
“We are also recommending termination of dealer licenses if they do not order sufficient product from their respective OMCs.”
Information and complaints being received by Petroleum Division are being forwarded to OGRA for deployment of vigilance teams against low stocks and overcharging.
OGRA has issued show cause notices to six OMCs and demanded immediate response.
The spokesperson reiterates Petroleum Division’s affirmation in ensuring that culprits are brought to book.
“If OMCs/dealers are not meeting their licenses conditions, OGRA will consider suspending or cancelling their licenses.”
Meanwhile the petroleum division has instructed PSO to increase their imports and supplies. Refineries have also been directed to ensure sufficient operations to meet planned imports to meet projected demand.