Oil consumption (ex-lubricant and non-energy products) in the country has increased by 2.7 percent on year-on-year basis to 1.575 million tons in the first month of current financial year (July 2007) as compared to 1.534 million tons consumed in the same month in previous financial year.
The figures available here show that the black oil (FO & LDO) showed only four percent growth in this period, whereas white oil products (MS, HSD, JP-1-8-4, HOBC and Kerosene) indicated a positive growth of 1.4 percent on yearly basis.
About 43.7 percent of the POL products' demand were met through imports, while the local refineries supplied rest. Imports were slightly lower against 44.4 percent during the last month due to availability of inventories.
"The growth in white oil products came from a number of reasons during July and a substantial increase in Mogas consumption (23.7 percent) has resulted due to recent internal measures taken by Iran to curb cross-border smuggling of the product into Pakistan", Khurram Shehzad, an analyst at Invest Capital said.
He said that Kerosene had also showed 9.9 percent growth due to substitution of gas by the rural consumers amid gas's theft and shortages prevailing in the country.
Decline in JP-1 was recorded due to change in flight schedule/aircraft, imposition of inland freight on PIA, causing it financial impact of Rs 450 million per annum, erratic supply from ARL and more exports (JP-1/8) than supplies to the local market. HOBC declined by 2.4 percent due to resuming Mogas consumption and higher price differential between the two.
Black Oil (FO five percent and LDO -21.6 percent) showed four- percent growth due to a high-base effect. Compared to the last year, low growth in furnace oil consumption can also be attributed to sufficient water availability and adequate inventory levels with a few major refineries. On the other hand, the LDO declined amid lower agricultural activities taking place and high base-effect of the same period last year.
Major slice of the market share pie remained with Pakistan State Oil (PSO) handling total volumes of 1.08 million tons during July. PSO managed to increase its market share by 1bp to 68.6 percent against 2007 financial year, due to higher Mogas volumes (despite only one- percent growth in FO).
APL has also gained market share through 21.7 percent higher FO volumes and 100 percent rise in JP-8 exports as compared to last month. APL captured up to 8.7 percent of the FO market share (up from 7.5 percent in 2007 financial year) with a total market share, settling 50bps higher at 6.1 percent.
Shell, on the other hand, lost its market share slightly from 13.9 percent in 2007 to 13.3 percent in July, mainly due to lower HSD volumes (down six percent MoM) and decreased share in Mogas by 60bps to 27.1 percent in July.