KARACHI: POL sales soared to 1.72 million tons in November 2020 - a two-year high - as compared to just 1.42 million tons in the same month in 2019. On a YoY basis, a double-digit growth was seen in all the three major fuel segments during November 2020. High Speed Diesel (HSD) sales stood out with a strong growth of 29 percent while Motor Spirit (MS) was not far behind with a 20 percent rise in demand.

Even Furnace Oil (FO) posted an 18 percent YoY rise in sales during the winter month. During the first five months of FY21, POL sales registered an overall growth of 10 percent with FO posting the strongest growth both in absolute and relative terms while oil products -- MS and HSD -- saw sales rise by 7.0 percent YoY and 11 percent YoY respectively over the period.

"Looking at the rise in these figures so far during the year, we believe it is now safe to categorize the recovery as a trend," Ali H. Zaidi, an analyst at the JS Global Capital, said.

The rise in popularity of FO during winters may be attributed to the ongoing gas shortfall as FO plants compensate for the power production, he said. Furthermore, recent news reports claim that the government has directed the Pakistan State Oil (PSO) to lift FO from local refineries to meet the power sector's demand before considering imports. This should bring some warmth to the local refineries while the OMCs enjoy strong sales in the deregulated black oil segment, he added.

Copyright Business Recorder, 2020