Refineries to resume fuel oil exports as domestic demand falls

KARACHI: Pakistan will resume exporting fuel oil after a one-and-a-half-month hiatus as a local refinery plans to ship 50,000 tonnes of the product in the coming days, industry officials said on Friday.

Fuel oil exports from Pakistan had stopped in January as domestic demand surged for electricity generation due to lower hydropower output amid canal closures. The country exported fuel in December 2023 for the last time and its total export reached an all time high level of 434,000 tonnes of fuel oil in the first half of the current fiscal year that began in July of this financial year.

“Pak Arab Refinery Limited (PARCO) is set to export 50,000 tonnes of fuel oil in the coming days,” an industry official said, as the local demand of fuel oil has dropped sharply after the power generation from hydel has seen growth in this month.

Officials said that PARCO has a huge stock of 69,000 tonnes of fuel oil and it is going for its export as other refineries do not have a huge quantity of the fuel oil currently. Pakistan Refinery Limited (PRL) and Cnergyico are presently shut down due to annual maintenance and Attock Refinery Limited (ARL) has planned to shut down its unit on February 18, 2024.

PARCO currently possesses 69 percent of the fuel oil, followed by ARL, which has 26 percent of the total furnace oil. Cnergyico has five percent furnace oil and PRL and National Refinery Limited(NRL) have four and one percent of the total stock of furnace oil, respectively. The country has 109,000 fuel oil stocks presently.

According to the consumption data of the fuel oil, its sale nosedived by 59 percent so far in the month of February compared to the same period of January this year. During the month of January, the total consumption stood at 183,000 tonnes and in the first half of January the total sale was 89,000 tonnes, which dropped to just 29,000 tonnes in the first half of the current month.