KARACHI: The first half of FY24 ended on a dismal note for the petroleum sector due to a 15 per cent drop in sales of petroleum products to 7.686 million tonnes from nine million tonnes in the same period last fiscal year.

Petrol sales posted a drop of 7pc to 3.57m tonnes during the July-December period from 3.83m tonnes in the same period of FY23 despite a price drop to Rs267.34 from Rs331.38 per litre in September 2023.

High-speed diesel (HSD) price had also fallen to Rs276.21 from Rs329.18 in September 2023 but diesel sales shrank by 6pc to 3.16m tonnes from 3.36mn tonnes in 1HFY23.

The overall fall in sales of cars, LCVs, pickups and jeeps by 50pc to 33,638 units during July-November FY24 from 67,107 units in the same period last fiscal year followed by 12pc and 3pc decline in two- and three-wheelers demand had resulted in slow off-take of diesel and petrol. Truck and bus sales had also remained low by 48pc and 45pc during 5MFY24.

Furnace oil (FO) sales clocked in at 0.56m tonnes from 1.45m tonnes during 1HFY23, down by 61pc.

However, FO sales witnessed a jump of 54pc during November 2023 to 82,000 tonnes from October 2023 due to a shortage of RLNG/gas and reduced hydel power generation in winter months, leading to a switch to FO-based power generation.

In December 2023, FO sales stood at 79,000 tonnes posting a drop of 36pc year-on-year and 4pc month-on-month.

Sales of overall petroleum products also remained depressed by 7pc to 1.24m tonnes during December 2203 from 1.33m tonnes in December 2022.

Petrol and HSD sales during December 2023 stood at 0.57m tonnes and 0.51m tonnes as compared to 0.62m tonnes and 0.52m tonnes during December 2022, showing a fall of 8pc and 2pc, respectively.

Market people said that a slowdown in demand for petrol and diesel reflects consumers’ buying behaviour as they are already perturbed over inflated utility bills and high food inflation, thus limiting their purchase of fuels as per their requirement despite a drop in petrol and diesel prices.

Published in Dawn, January 3rd, 2024