Petroleum product sales surge 57pc in April 2021

Total petroleum products sales increased 57 percent to 1.672 million tons during April 2021 against 1.068 million tons recorded during April 2020, data issued by Oil Companies Advisory Committee (OCAC) showed on Tuesday.

The increase was largely on account of April 2020’s low-base because of peak lockdown restrictions implemented during the month,” Yusuf Rehman at KASB Securities said.

On a monthly basis, oil marketing companies’ (OMCs) off-take picked up 13 percent supported by a sharp increase in High Speed Diesel (HSD) sales.

Total Motor spirit (MS) off-take increased 13 percent to 6.729 million tons during 10MFY21 largely supported by higher vehicle sales, comparatively relaxed Covid-19 restrictions, and increased inter-city transport.

On a monthly basis, however, MS off-take fell 2.0 percent to 671,000 tons largely because of re-implementation of stricter restrictions, including closure of educational institutions, amidst the thirds Covid-19 wave.

“Onwards, we believe a potential for stricter lockdown restrictions, including a ban on inter-city travel, in light of rising infection rates will likely keep the commodity’s off-take growth capped in the coming months,” Rehman said.

Pakistan State Oil (PSO) emerged as the market leader in MS with a share of 45 percent.

Total HSD sales picked up 20 percent to 6.159 million tons during 10MFY21 aided by recovering economic activity evidenced by high LSM growth and action against smuggled petroleum with over 2,000 illegal pumps being sealed.

On a monthly basis, HSD sales shot up 47 percent to 786,000 tons because of the wheat harvest season. “Onwards, we project HSD sales to find support from the government’s pro-growth stance and the consequent increase in overall economic activity. Our growth thesis, however, may be temporarily derailed in case the federal government opts for imposing stricter economic restrictions if infection rates surge past a certain threshold.”

PSO emerged as the market leader in the commodity with a share of 48 percent during April 2021.

Fuel Oil (FO) sales picked up 48 percent to 2.479 million tons during 10MFY21 because of increased demand from FO-based power plants. Prevalent gas shortage in tandem with FO’s comparatively lower price, increased demand for the commodity from both the national power plants and private-sector captive plants.

On a monthly basis, FO sales dipped 36 percent to 176,000 tons during April 2021, as domestic FO prices rose in tandem with global oil prices and the national gas supply likely normalised once the warmer weather commenced. PSO emerged as the market leader in the commodity with a share of 43 percent during April 2021.

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