KARACHI: Oil Marketing Companies’ sales witnessed double-digit growth in December due to higher demand from power producers, as well as, successful measures by the government to curb smuggling.
Pakistan, which largely depends on imported fuel to run industries and power generation, struggles to curb energy costs to keep its industry competitive in international markets.
Demand for refined furnace oil and high-speed diesel increased drastically with the revival of economic activity along with high production demand from power producers, Abdulla Umer, oil sector research analyst at Ismail Iqbal Securities Ltd., said. The trend is expected to maintain its upward direction in the near future, he added.
Industries’ sales volumes continue to witness double-digit growth, registering 16% growth in December compare to last year. Retail Volumes increased by 10%, while refined furnace oil sales increased by 108%. Within retail fuels, high-speed diesel has registered 13% growth, where the peak of Rabbi season has added to the improved demand. MOGAS has registered 5% growth, while major surprise has been witnessed in furnace oil sales, that jumped 108% compared to last year.
Within the industry, PSO’s reclaiming of market share continued in December 2020, where a share in high-speed diesel increased by 4% compared to last year. PSO is offering discounts to retail outlets on incremental purchases, which have been the major reason behind the increase in market share and other factors. PSO’s share in furnace oil has also increased which may lead to accretion of receivables from power producers in the near future.
Attock Petroleum’s market share continued to dwindle in retail fuels owing to loss of major government contracts. However, on a month-to-month comparison, Attock’s share in high-speed diesel improved to 7.4% in December 2020 from 6.3% in November 2020 on the back of a drop in the market share of GO Petroleum and upward price revisions in retail fuels. HASCOL continued to lose market share as its market share in retail fuels has seen a persistent decline in the financial year 2021. HASCOL has lost 4% in high-speed diesel and 2% market share in MOGAS compared to last year. On the other hand, SHEL’s market share remained stable in MOGAS at 11%, whereas uptick was recorded in high-speed diesel by 2% in December 2020.
