Fuel Prices Dip Drives Higher Sales in Pakistan
Staff Report
Pakistan’s OMC’s sales in October 2023 recorded 1.3 million tons, up 19% MoM, with Ex-Furnace Oil (FO) sales increasing by 24% MoM in October 2023.
The MoM jump in sales is attributed to a low base from the previous month, higher prices, and consumers waiting in anticipation of a decline in prices to fill up their tanks.
The average petrol price in October 2023 decreased to Rs 303 per liter, compared to Rs 318 per liter in September 2023. Similarly, average diesel prices dropped to Rs 311 per liter in October 2023 from Rs 321 per liter in September 2023. Oil Prices to Remain Steady from Nov 1, 2022
On a YoY basis, total OMC sales in October 2023 were down 24% YoY, with Ex-FO sales down by 17% YoY. The YoY decline in sales is due to higher fuel prices and an economic slowdown.
FO sales for October 2023 fell by 74% YoY and 37% MoM to 54,000 tons due to lower FO-based power generation.
This brings the total sales for 4MFY24 to 5.1 million tons, down 17% YoY, while Ex-FO sales decreased by just 6% YoY to 4.7 million tons in 4MFY24.
To highlight, the average petrol prices in 4MFY24 stood at Rs 290 per liter, up 25% YoY, and the average diesel prices increased by 19% YoY to Rs 293 per liter in 4MFY24.
Among the listed entities, Attock Petroleum (APL) sales amounted to 124,000 tons, reflecting a 10% YoY decline and a 1% MoM increase. FO sales dropped by 53% YoY and 39% MoM due to the reasons mentioned above.
Pakistan State Oil (PSO) saw a 26% YoY decrease but a 23% MoM increase to 628,000 tons. FO sales were down 95% YoY and 55% MoM. PSO’s total market share stood at 50% in October 2023, compared to 51% in October 2022 and 48% in September 2023.
Shell Pakistan (SHEL) experienced a 30% YoY decline and a 12% MoM increase to 90,000 tons. HSD saw a 36% YoY decrease and a 28% MoM rise, which significantly contributed to the company’s sales.
For FY24, we anticipate a potential recovery in Ex-FO OMC sales, estimated to increase by up to 5%. This is primarily attributed to a pickup in economic activity, where interest rates are expected to decline in the latter half of FY24, coupled with a favorable agricultural crop this year.
