OUR STAFF REPORTER
LAHORE – The CNG and power shortage has constantly been driving up the petrol demand in the country, as the circular debt has weighed heavily on the operating environment of the OMCs while the gas curtailment is turning out to be a blessing in disguise for them. Furnace oil sales continues to remain suppress in July while Motor Spirit sales touched record high of 250k tons, up by a colossal 33.7 per cent as compared to last year.
According to industry sources, it is estimated that approximately 20 per cent of the overall petrol demand is being driven by power shortage which has forced consumers to use petrol as a backup fuel for electricity generation.
Overall, country’s oil sales declined by 1.4 per cent to 1.8 million tons in July 2011 against 1.9 million tons in the same period last year. In addition to decline in the FO sales by 5.2 per cent, the other major culprit was decline in High Speed Diesel sales, down 5.9 per cent from last year. Furthermore, country’s reliance on the imported sources remained high around 64 per cent while only 34 per cent was met through indigenous sources.
Company wise data show that, Pakistan State Oil and Shell Pakistan sales declined by 9.5 per cent and 18.7 per cent on account of their exposure to FO and HSD markets, respectively. Contrary to industry trend, APL sales picked up by a massive 26 per cent to 139k tons on account of higher weight-age of MS in its product mix.
The prevalent gas curtailment to CNG stations and overall power outages has turned out to be a blessing in disguise for the OMC sector as MS (petrol) sales continue to show startling performance.
Energy expert, Nauman Khan, said that during the month of July, MS sales touched record high of 250k tons up by a massive 15.5 per cent from the pervious high of 217k tons recorded in last month. The sales are a massive 33.4 per cent up from last year sales, while product contribution in the sales mix has increased to 14 per cent as against 10 per cent in the same period last year.
FO sales continue to be adversely affected by the notorious circular debt. During the month of July, FO sales stood at 842k tons, down 5.2 per cent as compared to 888k tons in the same period last year.
Moreover, on MoM basis, FO sales declined by 12.6 per cent amid better hydel generation as heavy rains in northern parts rendered into higher water availability for power generation. In addition to FO sales, HSD sales also remained subdued and stood at 625k tons in July, down 5.9 per cent as compared to same period last year.
With higher exposure to FO business, PSO sales continue to be negatively affectively affected by the circular debt. Company’s FO sales declined by 11.4 per cent, rendering into overall sales decline of 9.5 per cent. While Shell, the other listed firm, showed volumetric decline of 18.7 per cent, sales of APL improved by massive 26 per cent primarily on account of better petrol sales.