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Tag: petroleum products

  • Pakistan high petroleum prices massively cut oil sales in July

    Pakistan high petroleum prices massively cut oil sales in July

    KARACHI: A big jump in petroleum prices in Pakistan has reduced the domestic sales of oil for the month of July 2022.

    According to details released on Tuesday Pakistan oil sales commenced the fiscal year 2022/2023 with a decline of 26 per cent MoM to clock in at 1.44 million tons in July 2022 (lowest since February 2021).

    READ MORE: New petroleum prices in Pakistan from August 1, 2022

    Analysts at Topline Securities attributed the sharp decline in domestic oil sales to significant decline in all 3 petroleum products: High Speed Diesel (HSD) sales reduced by 38 per cent MoM to 444, 000 tons, Motor Gasoline (MOGAS) sales declined by 15 per cent MoM to 594,000 tons and Furnace Oil (FO) sales dipped by 23 per cent MoM to 350,000 tons.

    Major reasons behind the decline in oil sales are, (i) Eid holidays during the first half of July where inter provincial transportation activity subsided which led to low HSD sales, and (ii) monsoon season across the country resulted in lower traffic on the roads.

    READ MORE: New petroleum prices in Pakistan from July 15, 2022

    Furthermore, increase in MOGAS and HSD prices by 26 per cent and 41 per cent since Jun-22 resulted in reduced demand of petroleum products and increase in usage of public transport and car pooling.

    As compared to last year, Pakistan oil sales recorded 26 per cent YoY decline in July 2022 which is owed to drop in MOGAS and HSD Sales by 27 per cent YoY and 38 per cent YoY, respectively. Excluding FO, oil sales were down 31 per cent YoY and 26 per cent MoM in July 2022 to 1.1 million tons.

    READ MORE: New prices of petroleum products in Pakistan from July 01, 2022

    Among the listed entities, Pakistan State Oil (PSO) sales posted 27 per cent MoM decline to 760k tons (lowest since Feb-22), mainly due to decline in HSD sales by 38 per cent MoM. In terms of market share, PSO market share clocked in at 53 per cent in Jul-22 vs. 52 per cent in July 2021.

    Other companies such as Attock Petroleum (APL) and Shell Pakistan (SHEL) also recorded drop of 29 per cent MoM and 37 per cent MoM to 142k tons and 100k tons, respectively.

    For FY23E, the analysts expect oil sales to drop by 15-20 per cent YoY in FY23E, mainly due to (i) low growth estimated in agriculture sector, (ii) likely decline in auto sales, and (iii) increase in petroleum prices.

    READ MORE: New petroleum prices in Pakistan from June 16, 2022

  • ECC approves petroleum dealer margin at Rs7/liter

    ECC approves petroleum dealer margin at Rs7/liter

    ISLAMABAD: The Economic Coordination Committee (ECC) of the cabinet has approved to fix petroleum dealers margin at Rs7 per liter for petrol and high speed diesel.

    The decision has been taken at a meeting of the ECC presided over by Finance Minister Miftah Ismail on Thursday.

    The Petroleum Division submitted a summary on revision of Oil Marketing Companies (OMCs) and dealers margins on petroleum products.

    READ MORE: Pakistan allows release of banned items stuck up at ports

    It was informed that the existing margins were fixed in December, 2021 and Pakistan Petroleum Dealers Association has approached the government for immediate revision of their margins due to inflation, increase in tariff salaries and utility bills, etc.

    Federal Minister for Commerce Syed Naveed Qamar, Federal Minister for Planning, Development and Special Initiatives Prof. Ahsan Iqbal, Federal Minister for Industries and Production Makhdoom Syed Murtaza Mehmood, Federal Minister for Power , Khurram Dastgir Khan, Federal Minister for National Food Security and Research Chaudhary Tariq Bashir Cheema, Shahid Khaqan Abbasi – MNA/ex-PM, Minister of State for Finance and Revenue Dr. Aisha Ghous Pasha, Minister of State for Petroleum Musadik Masood Malik, Rana Ihsan Afzal, Coordinator to the PM on Commerce and Industry, Coordinator to the PM on Economy, Bial Azhar Kayani, Federal Secretaries and senior officers attended the meeting.

    READ MORE: SBP makes permission mandatory for motor car import

    Ministry of National Food Security and Research submitted a summary on urgent advice relating to award of 4th International Wheat Tender 2022 opened on 25th July, 2022.

    It was informed that Trading Corporation of Pakistan (TCP) issued 4th tender on 19-05-2022 for securing quantity of 200,000 MT of imported wheat on CFR basis.

    The tender was opened on 25-07-2022 wherein six (06) international suppliers participated, out of which 05 offered rates. The ECC after detailed discussion approved the lowest bid offered by M/s Falconbridge FZLLC@ US$ 407.49/MT CFR bulk on sight LC basis with direction to TCP to negotiate with the Russian authorities to procure wheat on lower rate subject to confirmation of the ECC.

    Ministry of Water Resources submitted a summary on compensation package for the Chinese causalities at Dasu Hydro Power project.

    READ MORE: Pakistan’s import bill records over $80 bn in 2021/2022

    The ECC decided that the amount of compensation/ good will package will remain the same as per ECC’s earlier decision dated January 21,2022 ( i.e US$ 11.6 million) and approved disbursement of the compensation/goodwill amount directly to the company M/s China Gezhouba Group International Engineering Co. Ltd (CGGC) through Ministry of Foreign Affairs.

    The Ministry of Industries and Production submitted a summary on issues faced by Fatima Fertilizer (Sheikhupura Plant) and Agritech.

    Both the SNGPL based plants are operated by provisioning of RLNG on cost sharing basis. Gas rate for operation of these plants is worked out on the basis of Variable Contribution Margin (VCM).

    Due to price increase in fuel prices and other factors, both plants have approached M/o I&P for revision of VCM and capping of GST at the price paid by the plants.

    READ MORE: CMOs worry over power outages, 100% cash margin on imports

    The ECC after discussion approved the proposal to ensure compliance with the earlier decision of the ECC and the Federal Cabinet of shifting both the plants to indigenous gas.

    The committee further directed Ministries of Petroleum, Finance, National Food Security and Industries & production to work out the gas price/VCM for the Fertilizers. The ECC also decided that Sales tax may be charged on the actual price of the gas being paid by the company.

  • 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.

    READ MORE: Dealers threaten shutting down petrol pumps from July 18

    “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.

    READ MORE: NA approves levy on petroleum products up to Rs50/liter

    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.

    READ MORE: New prices of petroleum products in Pakistan from July 01, 2022

    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.

    READ MORE: Petroleum levy to generate Rs750 billion

    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.

  • Sales tax collection from POL products falls by 40%

    Sales tax collection from POL products falls by 40%

    ISLAMABAD: The Federal Board of Revenue (FBR) has recorded a decline of 40 per cent in sales tax (ST) collection on petroleum (POL) products during the first half of the current fiscal year, according to official documents made available to PkRevenue.com

    According to the official statistics, the collection of sales tax fell to Rs69 billion during July – December of fiscal year 2021/2022 as compared with Rs114.60 billion collected in the same period of the last fiscal year.

    READ MORE: Share of sales tax collection increases to 43.7% in 1HFY22

    The decline in revenue collection from petroleum products mainly attributed to lower rates of sales tax kept by the government in order to provide relief to the masses by not passing on the actual increase in petroleum prices as surge in international markets.

    The flat rate of sales tax is 17 per cent. However, the government decided to keep the rate of sales tax on petroleum products to the minimum level. According to SRO 1839i0/2022 issued on February 10, 2022, the sales tax rates have been reduced as: petrol 0.79 per cent; high speed diesel 3.17 per cent, kerosene oil 5.30 per cent and light diesel oil at zero per cent.

    READ MORE: FBR extends sales tax return filing up to February 25

    The fall in sales tax collection from supply of petroleum products resulted decline in collection of sales tax on domestic supply.

    The overall sales tax collection on domestic supplies fell by 6.2 per cent to Rs382.68 billion during the first half of the current fiscal year as compared with Rs408.13 billion in the corresponding period of the last fiscal year.

    However, the fall in sales tax collection domestic was offset by the massive growth in collection of sales tax on imports. The sales tax collection on imports surged by 75.4 per cent to Rs892.30 billion during the first half of the current fiscal year as compared with Rs508.61 billion in the corresponding half of the last fiscal year.

    READ MORE: FBR announces promotion of BS-16 Customs officers

    The growth in sales tax collection on imports can be attributed to sharp jump in imports and massive decline in rupee value.

    The import bill of the country registered a growth of 66.23 per cent to $40.65 billion during first half of the current fiscal year as compared with $24.45 billion in the corresponding half of the last fiscal year.

    READ MORE: FBR makes rules for sealing retail outlets

    Similarly, the Pak Rupee (PKR) fell sharply by Rs18.97 to the dollar during the first half of the current fiscal year. The rupee ended down by 12.04 per cent from Rs157.54 to the dollar on June 30, 2021 to Rs176.51 on December 31, 2021.

    The overall sales tax collection however, recorded 39.1 per cent to Rs1.27 trillion during the first half of the current fiscal year as compared with Rs916 billion in the corresponding half of the last fiscal year.

  • Tax reduced on POL products to ease inflation: PM Imran

    Tax reduced on POL products to ease inflation: PM Imran

    Prime Minister Imran Khan on Friday said the government has reduced taxes and duties on petroleum products to ease inflationary pressure.

    The Prime Minister Imran Khan said Pakistan has been put on right course with record exports, tax collection and remittances by the expatriates.

    READ MORE: Pakistan’s sensitive price inflation jumps up 18%

    Addressing a public gathering in Mandi Bahauddin, he said the inflation impacting the common man and the government is trying to ebb away its pressure by reducing taxes and duties on petrol import.

    Imran Khan said for the first time, the government also granted overseas Pakistanis voting right, enhanced farmers’ income, ensured the timely payments to sugarcane farmers.

    READ MORE: Pakistan’s inflation climbs up 24-month high in January

    The prime minister said the government is bringing about an IT revolution in the country as 70% rise in IT exports has been recorded. He also said the government was providing interest free loans to the youth and Rs 1 million health insurance to every family in Punjab.

    READ MORE: January headline inflation may clock near 13%

    Imran Khan said this is just the beginning and we have to make Pakistan a welfare state with Sehat Card being the biggest step towards it.

    He said by March, Sehat Card will be available across Punjab for which provincial government has allocated 400 billion rupees.

    READ MORE: Mini-budget likely to push up inflation: SBP

  • FBR announces sharp cut in sales tax on POL products

    FBR announces sharp cut in sales tax on POL products

    ISLAMABAD: The Federal Board of Revenue (FBR) has announced sharp cut in sales tax on supply of petroleum products.

    The FBR on Thursday issued SRO 183(I)/2022 to reduce the sales tax against normal rate of 17 per cent.

    The revenue body previously issued SRO 88(I)/2022 dated January 18, 2022 to change the sales tax rates.

    READ MORE: FBR slashes sales tax rates on petrol, HSD

    According to the SRO 183(I)/2022, the sales tax rate on light diesel oil has been slashed to zero percent from previous 2.7 per cent.

    The sales tax rate on petrol has been reduced to 0.79 per cent from 2.5 per cent. Similarly, the sales tax on high speed diesel has been reduced to 3.17 per cent from 5.44 per cent.

    The sales tax rate on kerosene oil has been slashed to 5.30 per cent from 8.30 per cent.

    READ MORE: Pakistan’s petrol price rises to record high at Rs147.83

    The federal government had deferred the increase in prices of petroleum products for next fortnight starting February 01, 2022. A statement issued by the Finance Division stated that the petroleum products were showing substantial increase in the international market and presently trading at highest level since 2014.

    The oil prices have witnessed an increase of 14.5 per cent just in January 2022 in the global market. The existing sales tax rate and Petroleum Levy on various petroleum products are much below the budgeted targets.

    READ MORE: Prices of all POL products increased to wish New Year

    The government is bearing the revenue loss of around Rs30 billion (fortnightly) on account of budgeted to existing petroleum levy and sales tax rates and Rs 260 billion annually due to reduced sales tax rate.

    Despite revenue losses due to rising petroleum prices globally, the Prime Minister of Pakistan has deferred the proposal by OGRA to increase up to Rs. 16.79/Litre in the petroleum product prices and desired that petroleum product prices shall remain the same from 1st February, 2022 as notified earlier on January 15, 2022 for providing maximum relief to the general public.

  • Pakistan’s petrol price rises to record high at Rs147.83

    Pakistan’s petrol price rises to record high at Rs147.83

    ISLAMABAD: The petrol price in Pakistan has been increased to a record high of Rs147.83 per liter, said a statement issued by the finance ministry on Saturday.

    The government announced to increase prices of all petroleum products with effect from January 16, 2022.

    READ MORE: Prices of all POL products increased to wish New Year

    According to the notification, the price of petrol has been increased by Rs3.01 to Rs147.83 per liter from Rs144.82.

    The price of high speed diesel (HSD) has been increased by Rs3 to rs144.62 per liter from Rs141.62.

    The rate of kerosene has been enhanced by Rs3 to Rs116.48 per liter from Rs113.48.

    READ MORE: Petrol price reduces to Rs140.82 per liter

    The price of light diesel oil has been increased by Rs 3.33 toRs114.54 per liter from Rs111.21.

    According to the notification the decision to enhance domestic prices of petroleum products because the international oil price had registered 6.2 per cent during the last week. Presently, at the highest level since last year.

    The existing sales tax rate and petroleum levy on various petroleum products are much below the budgeted targets.

    READ MORE: Govt. keeps petroleum prices unchanged

    The finance ministry said that against the recommendations of Oil and Gas Regulatory Authority (OGRA) for increase of Rs5.52 per liter in petrol and Rs6.19/liter in high speed diesel prices, the Prime Minister had directed to absorb at the international prices through further cut in sales tax from last fortnight.

    The finance ministry will take Rs2.6 billion revenue hit due to reduced sales tax rates.

    Therefore, the government has decided to make partial increase in the prices of the petroleum products in order to provide relief to the end consumers.

    READ MORE: Petroleum prices kept unchanged for next fortnight

  • FBR raises sales tax on all petroleum products

    FBR raises sales tax on all petroleum products

    ISLAMABAD: The Federal Board of Revenue (FBR) on Monday notified an increase in sales tax on all the petroleum products.

    The FBR issued SRO 01(I)/2022 to notify increase in sales tax rates on petroleum products. The FBR amended the rates of sales tax, which were issued previously through SRO 1604(I)/2021 on December 16, 2021.

    READ MORE: Prices of all POL products increased to wish New Year

    According to the latest notification enhanced the sales tax on petrol from 1.63 per cent to 4.77 per cent.

    The sales tax rate on high-speed diesel has been increased to 9.08 per cent from 7.37 per cent.

    The FBR enhanced the sales tax on kerosene oil to 8.30 per cent from 8.19 per cent. Likewise, the sales tax on light diesel has been increased to 2.70 per cent from 0.46 per cent.

    The government on December 31, 2021 increased prices of all petroleum products effective from January 01, 2022.

    READ MORE: Petrol price reduces to Rs140.82 per liter

    The prices have been increased across the board around Rs4 per liter on all the products.

    According to a notification issued by the finance division, the new price of petrol has been increased by Rs4 to Rs144.82 per liter from Rs140.82. The rate of high-speed diesel (HSD) has been increased by Rs4 to Rs141.62 per liter from Rs137.62. Similarly, the price of kerosene has been increased by Rs3.95 to Rs113.53 per liter from Rs109.53. Likewise, the price of light diesel oil has been increased by Rs4.15 to Rs111.06 per liter from Rs107.06.

    READ MORE: SBP revises manual on remittances for petroleum sector

    The notification stated that in the fortnightly review of petroleum products prices, the prime minister had rejected the proposal of Oil and Gas Regulatory Authority (OGRA) for an increase in prices of petroleum products and advised to increase only Rs4 per liter to meet the petroleum levy target agreed with the International Monetary Fund (IMF).

    “Sales tax on petrol and diesel has been adjusted downwards as compared to December 16, 2021, to keep the prices lower,” the notification stated.

  • FBR notifies increase in sales tax on petrol, HSD

    FBR notifies increase in sales tax on petrol, HSD

    The Federal Board of Revenue (FBR) has announced an increase in sales tax on the supply of petrol and high-speed diesel (HSD), as outlined in the recently issued SRO 1640(I)/2021.

    (more…)
  • Petrol price reduces to Rs140.82 per liter

    Petrol price reduces to Rs140.82 per liter

    ISLAMABAD: The government on Wednesday decided to reduce the prices of petroleum products for next fortnight considering the fall in international oil prices.

    The government has not passed on the all the benefit of fall in international oil prices as it enhanced sales tax rates. However, the government kept the petroleum levy unchanged. The prices are applicable from December 16, 2021.

    Price on petrol cut by Rs 5 to Rs 140.82/ltr

    Price on diesel cut by Rs 5 to Rs 137.62/ltr

    Petroleum levy on petrol and diesel remained unchanged at Rs 13.62 and Rs 13.14.

    Sales tax on petrol raised from 1.63 per cent to 4.77 per cent. Ssles tax on diesel raises from 7.37 per cent to 9.08 per cent

    FBR hikes sales tax rates on petroleum products