ISLAMABAD: Amid economic slowdown, the country’s oil import bill and local production of petroleum products declined 21.84 per cent and 11.23pc, respectively, during the first 11 months of FY23.

As a consequence, exports of petroleum products were down by 24.61pc in 11MFY23 from a year ago. The foreign sales of crude oil and petroleum products were down by 21.97pc and 32.65pc, respectively.

In dollar terms, the oil imports dipped by 21.80pc to $15.38 billion during 11MFY23 from $19.67bn in the same period last year despite higher international prices, according to data released by the Federal Bureau of Statistics (PBS).

In rupee terms, the decline was relatively lower at 6.88pc because of massive currency devaluation and amounted to Rs3.713 trillion this year, compared to Rs3.474tr last year.

According to the PBS data, the import of petroleum products was down by 32.67pc to $6.74bn during the 11MFY23, compared to $10.02bn in the same period last year. In rupee terms, the import of petroleum products dropped 8.86pc to Rs1.617tr on a year-on-year basis.

Likewise, the import bill of crude oil was down by 4.99pc during the 11MFY23 to $4.52bn against $4.75bn in the same period last year. The rupee value of crude import went up by 30.44pc to Rs1.09tr year-on-year. The economic slowdown is blamed for a reduction in import quantities of crude oil and petroleum products.

The import bill of liquefied natural gas (LNG) also dropped by 19.07pc to $3.47bn during the 11MFY23 compared to $4.28bn during the same period last year. The rupee value of LNG import was, however, higher by about 12.31pc at Rs848.90bn compared to Rs755.83bn, showing a loss of exchange rate.

The import quantity of petroleum products also fell by 38pc to 9.70m tonnes year-on-year. The crude import quantity was 13.99pc lower to 7.01m tonnes during the 11MFY23 against 8.15m tonnes during the same period last year.

The reduction in import quantities of crude oil and petroleum products is a clear indication of reduced transportation and other economic activities in the country. This also suggests lower capacity utilisation of local oil refineries, compared to the last year, resultantly affecting their profitability.

Published in Dawn, June 23rd, 2023