Pakistan fuel oil imports low for second straight month

SINGAPORE: Pakistan imported below average volumes of power-generation fuel oil for the second straight month in September as demand for the utility fuel has fallen due to higher hydropower output because of the monsoon season.

It bought about 615,000 tonnes of fuel oil for September, a tad below monthly average volumes of about 620,000 tonnes and up 6.7 percent from August, official data showed.

Due to the lower demand, the country has sought 780,000 tonnes of fuel oil in its latest tender for November to January, about half the volume it bought in the August to October one.

"The volumes have been falling in the past 2-3 months and October demand isn't great either," a Middle East-based trader said. "Some October-delivery cargoes have been deferred to November. That's why they are seeking less in the current tender."

Pakistan bought about 496,000 tonnes of high-sulphur fuel oil (HSFO), 3 percent less than the previous month, and another 118,000 tonnes of low-sulphur fuel oil (LSFO), for September, data from its Oil Companies Advisory Committee showed.

Import volumes have been falling after peaking to an all-time high of nearly 850,000 tonnes during the summer in June.

"There isn't as much rain now but Pakistan still has ample hydropower," another trader said.

Pakistan's rainy season usually starts in July and lasts till the end of September, but certain parts of the country experience a longer monsoon season.

Pakistan's fuel oil imports are expected to pick up towards the end of the year, to meet peak demand for heating during the winter season.

Copyright Reuters, 2011