August saw a 4% increase in oil demand.
KARACHI: According to Arif Habib Ltd (AHL), the country’s oil demand decreased by 8% year over year in August but increased by 4% month over month to 1.41 million tonnes.
The total oil sales during the first two months (July and August) of 2023–24 decreased by 7 percent from 2.97 million tonnes in the same period of FY23 to 2.76 million tonnes.
From 0.66 million tonnes in July to 0.67 million tonnes in August, petrol sales increased by 2%. They also increased by 5% from the 0.64 million tonnes sold in August 2022.
However, compared to the same period in 2022, fuel sales between July and August of FY24 increased by 8% to 1.33 million tonnes.
Sales of high-speed diesel (HSD) increased by 11% in August to 0.55 million tonnes from 0.49 million tonnes in July 2023 and 0.50 million tonnes in August 2022. Diesel sales increased by 11 percent during 2MFY24 to 1.04 million tonnes from 0.94 million tonnes during the same time in FY23.
Despite the massive entry of Iranian diesel into the nation and the significant need for diesel owing to the harvest of rice and cotton, the growth in diesel sales seems surprising.
Sales of furnace oil decreased by 18% to 0.12 million tonnes in August from 0.14 million tonnes in July and by 64% year over year from 0.33 million tonnes in August 2022. Sales dropped by 61 percent from 0.68 million tonnes in 2MFY23 to 0.26 million tonnes in 2MFY24.
According to Mohammad Sohail, chief executive of Topline Securities, sales numbers for petrol and diesel may decline somewhat in September as a result of two price increases in August. Because there were few working days in July, sales had continued to grow just a little slowly.
Furnace oil consumption typically varies based on electricity generation, according to Fahad Rauf, head of research at Ismail Iqbal Securities, and the fuel is also exported due to low demand in the nation.
In addition, industries are moving towards the production of LNG and coal-based power.
When compared to the same period last year, when numerous crops were affected by floods, he claimed that the increase in diesel sales during July and August cannot be deemed substantial.
Diesel sales, according to him, also reflect economic activity that has stayed slightly subdued; otherwise, he claimed, sales numbers would have been substantially stronger.