Increased economic activity and heightened car sales have been shaping petroleum consumption in the country. The August numbers by Oil Companies Advisory Council show that the total sales of petroleum products by the OMCs touched 2.3 million tons, up 21 percent year-on-year.
The main source of flight in sales of petroleum products in August was furnace oil, but motor gasoline and high speed diesel also maintained their growth. Furnace oil volumes in August jumped by 31 percent year-on-year primarily due to higher seasonal demand and government's effort to ensure of power supply, and increased economic activity, while motor gasoline (petrol) and diesel also exhibited decent increase in volumes sold of 17 and 15 percent, respectively.
The overall volumes for the first two months of FY17 (i.e. July and August) also depict the same trend with higher furnace oil sales in summers along with increase in petrol and diesel consumption.
A company-wise analysis shows that the OMC segment in for increased competition; the larger players have seen their market share fall where new and existing smaller players have witnessed an increase in share.
Though PSO, the largest OMC, has had an increase in sales volumes the OMC giant lost some market share in retail fuels like petrol and HSD. Analysts at Optimus Capital Management highlights that this trend will continue as the industry is getting more competitive with PSO facing multiple risks such as circular debt, renewal of LNG contract etc.
APL's market share too has receded particularly in furnace oil. However, its market share in retail category has as it has been expanding in presence.
Of the smaller and new entrants, Hascol has enjoyed the limelight of late; it has too been broadening its network. Witnessing a significant growth in market share.
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