RECORDER REPORT

KARACHI: The sales of Oil Marketing Companies (OMCs) increased by 5 percent to 2.5 million tons in the month of Oct 2017.

This was mainly driven by MOGAS (Petrol) sales that were up 9 percent on year-on-year basis. In contrast, High Speed Diesel (HSD) sales were up only 2 percent, which is more sensitive to oil prices changes.

To recall, Petrol & Diesel prices were raised by 3 percent to Rs 74 per litre and Rs 79 per litre by the Government of Pakistan due to rising international oil prices trend.

Furnace Oil (FO) sales growth remained muted at 2 percent as initiation of coal and LNG based power plants slowed down FO sales growth. This trend has been seen for last 6 months.

Hascol Petroleum (HASCOL) and Attock Petroleum (APL) outperformed the market growing by 65 percent and 20 percent on year-on-year basis, respectively.

Pakistan State Oil (PSO) sales remained flat while Shell Pakistan (SHEL) posted sales decline of 33 percent. Based on four month of FY18 and sales outlook, we anticipate 4.5 percent increase in total sales in FY18. Recent revision in OMC margins on Petrol in line with CPI and deregulation of HSD bodes well for the sector, an analyst at Topline Securities said.