LAHORE - Oil and Gas Regulatory Authority (OGRA) has provisionally suspended the operations of 5 Oil & Marketing Companies (OMCs), however, the licenses of any listed OMCs have not been suspended.

According to industry experts, the regularity authority, in 2011, had also suspended the licenses of 7 Oil & Marketing Companies (OMCs) and imposed a fine of Rs3 million each. These companies include Askar, Hascol, Admore, OOTCL, Bakri, Byco and Total on account of breach of license and conditions under which OMCs should maintain a fuel stock of 20 days.

According to data, Pakistan oil consumption clocked in 10 percent annually and 8 percent monthly, lower at 1.57 million tons in 2014-15, as Furnace Oil sales dropped 17 percent annually and 23 percent monthly. Other petroleum products depicted mixed trends, with Motor Gasoline (MS) sales up 9 percent YoY but down 4 percent MoM. On the other hand, High Speed Diesel (HSD) sales were down 12 percent YoY but up 12 percent MoM. Company wise breakup shows Pakistan State Oil’s (PSO) market share dipped to 56 percent in Nov-2014 from 63 percent in Nov-2013 as its sales declined by 19 percent YoY in Nov-2014 while Attock Petroleum’s (APL) market share expanded to 11 percent from 9 percent given 9 percent YoY higher sales during the month.

Oil consumption in 5MFY15 clocked in at 8.87mn tons, similar to consumption of 8.84mn tons in the corresponding period last year (+0.3 percent YoY). Our FY15E sales target remains intact at 21.7mn tons (+3 percent YoY). However, quarterly sales trend is weak as average monthly sales (AMS) in 2QFY15 to date are down 13 percent and 3 percent vis-à-vis 1QFY15 AMS and 2QFY14 AMS respectively. PSO depict the weakest trend with sales down 17 percent vs. 1QFY15, while APL’s sales have dipped by 9 percent during the same period.