ISLAMABAD: The sales of two major petroleum products — petrol and diesel — crossed a record 560,000 tonnes and 900,000 tonnes respectively last month.

Because of the unusual sales, the government has banned export of petrol and diesel by local refineries for the time being, according to an official of the ministry of petroleum and natural resources.

He told Dawn that the monthly sales of petrol and diesel normally averaged 400,000 tonnes and 600,000 tonnes respectively. But their sales last month were exceptionally higher.

He said no definitive reason could be found for the rise except that lower prices of petroleum products encouraged higher consumption of petrol by motorists and higher water pumping by farmers for watering crops.

He said some vendors also appeared to be building up stocks as international prices had started rising in recent months. He said an authorised import of about 80,000 tonnes of high speed diesel by a local refinery had raised eyebrows among members of the oil industry working under the umbrella of the Oil Companies Advisory Committee.

The official said the latest figures about the sales of petroleum products were firmed up at a recent product review meeting of the oil industry and the ministry in Islamabad on June 18. It was noted that “May 2016 had seen the highest ever sales of both premier motor gasoline and high speed diesel” and yet there were sufficient stocks available.

As of June 8, the country had petrol stocks sufficient for 12 days of coverage (205,000 tonnes) against a mandatory 21-day stocks while diesel stocks were enough for 22-day coverage or 530,000 tonnes.

The meeting was informed that oil marketing companies had sold 560,324 tonnes of petrol last month against a demand of 528,850 tonnes, which was a new record. Supplies from local refineries stood at 118,300 tonnes against their commitment of 125,000 tonnes whereas imports of 358,640 tonnes were materialised. There was a sale deficit of more than 71,300 tonnes.

Based on sales in May, total petrol demand in June has been estimated at 531,500 tonnes with plans for importing 430,000 tonnes and producing 141,000 tonnes locally. Therefore, the government has imposed a ban on export of mogas (petrol) by refineries during the current month cycle.

Also, it was reported that oil marketing companies had sold a record 895,000 tonnes of high speed diesel (HSD) in May against a demand of 944,000 tonnes.

The refinery supplies stood at 318,400 tonnes against their committed production of 319,000 tonnes.

The official said the HSD sales were unusually higher than ever before and the government was investigating the precise reasons for such a surge. He said the industry and the government had decided to remain careful and had estimated HSD demand at 707,820 tonnes for this month.

It will include about 390,000 tonnes of production by domestic refineries and plans for import of 423,000 tonnes during the current month.

The official said the oil marketing companies had supplied 898,000 tonnes of high sulphur furnace oil in May against a demand of 965,000 tonnes. The local refineries supplied 175,600 tonnes against their promise of 197,000 tonnes.

Published in Dawn, June 27th, 2016