May 21, 2003	Wednesday	Rabi-ul-Awwal 18,1424

KARACHI, May 20: Industrial consumption of petrol, oil and lubricants rose by 1.7 er cent during July-March 2002-03 to 12.640 million tons from 12.433 million tons consumed in the same period last fiscal, thus showing signs of some economic recovery.

Out of six, consumption of four main products — petrol, kerosene, high speed diesel and light diesel oil — has shown negative trend, while consumption of fuel oil and JP-1 depicted an increase of 3.54 per cent and 29.35 per cent, respectively, during July-March 2002-03, thus offsetting the impact of decline in four products.

“Despite negative trend, I think the overall consumption of POL products by the end of the current fiscal year is likely to remain same at 17.9 million tons of last financial year in view of the prevailing conditions and no major change in demand pattern except for some items,” an official in the Oil Companies Advisory Committee said.

According to a data compiled by the OCAC, demand for petrol (MS 87 RON) plunged by a mere 0.54 per cent despite 43 per cent increase in sales of new cars during July-March 2002-03. Conversion of cars to compressed natural gas (CNG) can be termed as one of the main reasons of declining petrol consumption as car makers, particularly of 800-1,000cc have rolled out both CNG kits cars and petrol versions.

Diesel consumption during the period under review stood at 5.042 million tons as compared to 5.055 million tons, showing a fall of 0.26 per cent. Furnace oil consumption showed a growth of 3.5 per cent to 5.740 million tons from 5.543 million tons.

According to an analyst at a brokerage house, increased consumption by the independent power producers (IPPs) which were typically operating at a higher load factor during November-March 2002-03 and higher inventory levels maintained by the IPPs and Wapda on account of the government’s instructions to meet any supply threat during the Iraq war could be the two primary reasons for increasing fuel oil consumption.

There is a general perception that furnace oil demand is likely to experience a negative growth owing to improved gas supplies. However, the analyst said that gas supplies are still insufficient to severely affect fuel oil consumption. The Pakistan State Oil, which enjoys 75-80 per cent market share in furnace oil, was main beneficiary of increasing consumption of fuel oil.

Consumption of JP-1 rose by 29.35 per cent to 545,875 tons from 422,017 tons owing to sales of 329,896 tons to the transport sector, 89,869 tons to the aviation sector and export of 120,447 tons to Afghanistan for coalition forces.

Kerosene consumption in July-March 2002-03 fell by 12.31 per cent to 249,542 tons from 284,562 tons. Consumption of light diesel oil also declined by 9.73 per cent to 164,278 tons from 181,994 tons.