KARACHI: The government has allowed two oil marketing companies (OMCs) to import 138,000 tonnes of high-speed diesel (HSD) in March this year.
At a Product Review Meeting (PRM), the Oil and Gas Regulatory Authority (Ogra) allowed Pakistan State Oil (PSO) to import 100,000 tonnes of HSD in March. The regulator also extended permission to Gas & Oil Pakistan Limited to import 38,000 tonnes of HSD next month.
According to sector sources, the regulator and oil industry representatives held divergent views on demand projections for the product for the coming month and the need for imports.However, Ogra granted permission in view of an expected rise in HSD demand in March. Sources said the regulator projected demand at 18,500 tonnes per day for the month.
The oil sector told the regulator that HSD demand would be around 16,500 tonnes per day next month. They said the regulator had set projections on the higher side to accommodate import permission for a private OMC.
They added that local refineries produce around 17,000 tonnes of HSD per day, which they said is sufficient to meet domestic demand, supported by PSO’s imports under its long-term contract with Kuwait Petroleum Corporation.
Sector sources said HSD demand is likely to subside in March due to Ramzan and Eid holidays.However, the regulator opted to allow imports on the grounds that recent tensions between Iran and the United States could create volatility in the oil market, and asked OMCs and refineries to maintain adequate HSD stocks in case of any emergency.
Regarding HSD imports in March, a senior executive at a local refinery said that although Ramzan and Eid holidays may reduce demand, it could pick up towards the end of March as the harvesting season begins in the southern part of the country, and increase further in April when harvesting reaches its peak.
The country imported 970,000 tonnes of HSD in the first seven months of the current financial year. Imports stood at 45,000 tonnes in July, rising to 162,000 tonnes in August. They then fell to 85,000 tonnes in September before increasing to 144,000 tonnes in October. Imports climbed to 205,000 tonnes in November and surged to 288,000 tonnes in December, before dropping to 42,000 tonnes in January.
