The previous fiscal year, FY23, witnessed a slump in petroleum product imports as the demand for petroleum products remained weak. Total sales of petroleum products by oil marketing companies fell by 27 percent year-on-year in FY23, a trend that was also reflected in the imports of the same, as a major portion of the country’s petroleum consumption is fulfilled through imports. A decline in petroleum imports continued during FY24, with oil sales continuing to fall throughout the year.

Despite some monthly recovery, High-Speed Diesel (HSD) sales have been weak, declining by around 4 percent in FY24. However, the monthly volumetric imports of HSD show a gradual increase with some fluctuations, as illustrated. The monthly import data by the Oil Companies Advisory Council (OCAC) indicates a slow but steady rise in HSD imports over the period. Imports peaked in November 2023 and again in April 2024, coinciding with the months when HSD consumption rises in the country due to sowing and harvesting seasons.

For Motor Gasoline, the monthly imports show a slight downward trend, in line with the decline in overall petrol sales. This weakness can be attributed to reduced petrol consumption in the country due to higher petrol prices. However, the recent decline in petrol prices could lift consumption in the coming months, which will impact petrol imports, as they account for over 60 percent of the total petrol sales by oil marketing companies. According to data released by the Pakistan Bureau of Statistics, imports of petroleum products in July 2024, in dollar terms, surged by 60 percent, reaching $1.266 billion compared to $791.434 million in July 2023. This further highlights the impact of higher petroleum product prices despite weak demand in the country.

Looking ahead, petroleum consumption is expected to witness a mild recovery, which will also be reflected in imports. However, petroleum demand will continue to be influenced by the global geopolitical situation and fluctuating oil prices.