Unlike the previous years like FY22 when the petroleum imports were rising, FY23 was a year where the oil imports witnessed a slump. Petroleum products sales posted a decline of 27 percent year-on-year during FY23. Similarly, the import volume of petroleum products also dropped by 38.4 percent during the year on a year-on-year basis. The trend of falling sales has continued in FY24 so far, and since Pakistan imports a major portion of its petroleum products like petrol, diesel, and other fuels, the same weakened trend was witnessed in imports too in 1HFY24.
As per the latest data from the Oil Companies Advisory Council (OCAC), petroleum imports in the country declined by around 24 percent year-on-year during the first six months of FY24. This does not come as a surprise as economic growth in FY23 and the ongoing fiscal year has been weak and debilitating. The data shows that the highest decline in imports of petroleum products was seen in high-speed diesel – one of the key fuels. The decline in HSD import volume was around 35-36 percent year-on-year during 1HFY24 standing at 830,000 tonnes versus 1.3 million tonnes in 1HFY23. In the latest month – December, the HSD volumetric imports were down by a whopping 73 percent month-on-month, and by around 77 year-on-year.
The petrol or motor spirit volumes during 1HFY24 stood at around 2.5 million tonnes also lower during the period. The decline in MS imports was however 5 percent year-on-year. In December, the MS import volumes were down by 32 percent month-on-month.
The decline in imports can be seen as a decline in consumption as well. The sales data that include local and import consumption also shows a declining trend. The oil sales by the oil marketing sector during the first half of FY24 witnessed a decline of around 15 percent year-on-year with sales of 7.7 million tonnes, as per the data by the OCAC. Petroleum sales by the OMCs for December 2023 stood at a little over 1.2 million tonnes, which was lower by around 7 percent year-on-year. The year-on-year decline in the top three fuels: furnace oil, high-speed diesel, and motor gasoline was around 36 percent, 2 percent, and 8 percent respectively. The decline came on the back of weak economic activity, rising petroleum product prices over the last year, and weak demand for furnace oil. Furnace oil imports have completely ended for over two years, and the demand is met completely locally as the global shift away from black oil continues.
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