Petroleum sales in 9MFY17

Retail fuel segment has been a key growth driver of volumes sold by the oil marketing companies (OMCs). In FY17, this trend has continued and can be seen from the OMC sales numbers by the OCAC. For 9MFY17, volumes sold for key petroleum products (furnace oil, diesel and petrol) stood at 17.98 million tons, which was 12.4 percent higher than similar period last year. The thriving retails segment cumulative volumes grew by 15 percent year-on-year, where the high speed diesel and motor gasoline saw an increase of 13 and 17 percent year-on-year, respectively.

However, on a month-on-month basis, the trend seems to have taken a breather in March 2017 primarily due to a slight increase in petroleum prices. Volumetric sales data for March'17 show a rise of 16 percent month-on-month, and -1 percent year-on-year. on overall volumes. Motor gasoline was up by only 2.7 percent, while HSD was up by 3.5 percent, year-on-year in March’17. A key feature of March’17 numbers is the significant jump in furnace oil volumes compared to February, which is largely due to increased consumption in the power sector as demand picks up.

Despite the recent slowdown, the market is optimistic about petroleum product sales. Petrol volumes increase in MFY17 has been primarily due to sustained lower oil prices, and hence lower petrol prices fuelling consumption and auto sales. High speed diesel volume also surged due to increasing construction and economic activities. And under CPEC, the growth in these retail fuel is likely to remain on an upward trajectory.