KARACHI: Oil marketing companies (OMCs) posted a 12 per cent increase in sales in the first 11 months of the current fiscal year to 23.8 million tonnes.

The sales remained higher than last three years’ average growth of 7pc due to low oil prices.

Furnace oil sales in July-May 2016-17 stood 10pc higher at 8.75m tonnes followed by 12pc jump in diesel sales to 7.887m tonnes while petrol sales went up by 17pc to 6.131m tonnes.

Diesel sales were down 3pc year-on-year whereas petrol and furnace oil (FO) sales were up 9pc and 1pc, respectively.

In May alone, OMC sales grew 2pc year-on-year to 2.43m tonnes.

Since December 2016, petrol and diesel prices had surged by around 10pc, slowing down sales growth of OMCs.

Furthermore, slow down in FO sales is also containing the OMCs sales growth as new power plants are based on coal.

An analyst at Topline Securities said total oil sales may clock in at 26.1m tonnes in 2016-17, 4pc lower than initial estimates as petrol/diesel sales had remained lower than our anticipation due to uptick in prices during the last few months.

Hascol Petroleum (Hascol) reported sales growth of 51pc in May 2017 supported by expanding branch network and storage capacity. Hascol’s market share has improved to 10pc in May 2017 versus 7pc in the same period last year.

Pakistan State Oil (PSO) saw decline of 10pc in its sales growth due to lower HSD and FO sales. This will take PSO’s market share to 54pc in May 2017 versus 61pc in May16.

The analyst said the government has reduced petrol and diesel prices by around 1.6pc for the June 2017 which could support sales going ahead.

PSO has also announced discount on regulated petrol price by up to Rs0.5/litre for the month of Ramazan that could further support petrol sales.

Published in Dawn, June 3rd, 2017