Pakistan’s oil sales recorded growth in March despite an increase in petroleum product prices and the government’s claims of adopting austerity measures to conserve energy.
According to data received from the Oil Companies Advisory Committee, diesel sales in March rose 21% to 587,000 metric tons compared with the same period last year. Consumption also increased 13% from February, when utilisation stood at 523,000 metric tons.
Similarly, petrol sales last month rose 16% to 670,000 metric tons, compared with 577,000 metric tons in the same month last fiscal year. Sales were also up 8% from 621,000 metric tons in February.
Prices and policy
Petrol prices since March 1 have increased by nearly 24.5% to PKR 322 per liter, while diesel prices rose 22% to PKR 336 per liter.
Over the past four weeks, the government has kept prices of both commodities unchanged to ease the burden on consumers. It has also shifted the price review mechanism from a fortnightly to a weekly basis.
During the first nine months of the current fiscal year, diesel consumption rose 7% to 12.4 million metric tons compared with the same period last year. Petrol consumption increased to 5.796 million metric tons from 5.506 million metric tons in the corresponding period.
Subsidy burden
The government has been under pressure to keep petrol and diesel prices unchanged.
So far, the cumulative subsidy has reached PKR 125 billion, of which PKR 100 billion is expected to be covered through the Public Sector Development Fund.
Currently, the government is paying PKR 203 per liter on diesel and PKR 96 per liter on petrol.
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