POL sales volume sequentially improved during May’20, up by 39% M/M to 1.48 MN tons, spearheaded by 1.1x M/M increase in FO to 145 KT during the month. The increase in FO is likely driven by the lower prices of the fuel, making it financially viable for use in power generation in the country.

On a Y/Y basis, volumes were down by 11.5%, with the brunt of the decline coming from FO volumes, which were down by 51% Y/Y or 150 KT. This was partially offset by an increase of 33 KT or 5.4%Y/Y in MS volumes.

The increase in MS volumes, up 46% M/M/ 5% Y/Y, can be attributed to lower ex-depot sale prices (May’20 price: PKR 80.15/liter; down 15% M/M/25% Y/Y) along with the higher demand as the lockdown in the country was partially eased and cars returned to the roads.

HSD offtake saw a 25.7% sequential increase, with the industry having sold 688 KT of the product during the month of May’20. This is likely driven by higher agricultural activity in the country on account of wheat harvesting, and the reduction in prices (HSD Price in May’20: PKR 80.10/liter; down 25% M/M/ 32% Y/Y). Furthermore, the resumption of industrial acitivities in the country likely aided in the heightened demand for the fuel.

Out of the listed OMCs, PSO stood out once again, with the company’s market share showing an improvement of 5.5ppt M/M during the month, with the company having sold 41.90% of the total volumes. HASCOL and APL saw lacklustre sequential growth in their market share, with the accretion to the tune of 20bps and 40bps, respectively. SHEL was the laggard during the month, with the company’s market share seeing an attrition of 90bps M/M.