The sale of HOBC (high octane blending component) hit record high at around 33,000 metric tons in Pakistan in the wake of discounts offered by the oil marketing companies (OMCs) in February 2025, attracting commuters to buy the better quality fuel in place of comparatively cheaper oil i.e. MS petrol.
Citing Oil Companies Advisory Council’s (OCAC) data, Optimus Capital Management (OCM) reported the sale of HOBC stood at around 15,000 metric tons in September 2024. It continued to surge every passing month since then, hitting a record high sale in February 2025.
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“Notably, February 2025 saw record-high HOBC sales for any month, as OMCs introduced significant price discounts, reflected in the price gap between MS and HOBC,” OCM’s analyst Zayan Babar Khan said in a commentary on monthly oil sales on Tuesday.
The state-owned oil marketing company’s sold HOBC (Euro5 Octane+) at Rs260.35 per litre and MS/petrol (Euro5 Premier) at Rs255.63 per litre as of March 4, 2025, suggesting the gap between the two products narrowed down to less than Rs5 per litre in Karachi.
The price difference stood around Rs18 per litre in February 2024 in the city.
The hi-octane blended fuel is used by luxury and imported cars. Compared to ordinary petrol (motor gasoline), the HOBC’s main use is for improved mileage and better engine performance.
The Oil and Gas Regulatory Authority (Ogra) does not control hi-octane price unlike petrol and diesel in Pakistan and the OMCs that import the fuel set its price. Accordingly, the hi-octane (HOBC) prices varying across different petrol pumps within one city.
Oil sales slumps 18%:
Meanwhile, the demand for petroleum oil products including petrol and diesel slummed 18% month-on-month in February 2025, dropping to 1.14 million tons in the wake of increase in the product prices in the month compared to the prior month of January.
Citing Oil Companies Advisory Council’s (OCAC) data, local research houses reported the oil consumption had stood at 1.38 million tons in January 2025.
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Arif Habib Limited’s (AHL) analysts Muhammad Iqbal and Menka Kirpalani said in a joint commentary that the notable decline in sales of the petroleum products was recorded on account of “fall in petroleum consumption amid higher price of MS (petrol) and high speed diesel.”
OCM analyst Khan reported the average price of motor gasoil (MS/petrol) rose by Rs2.23/litre to Rs256.3/litre in February compared to January, while high speed diesel (HSD) average price up by Rs6.3/litre to Rs267.0/litre “due to higher Brent prices, and exchange rate adjustment on MS and HSD.”
Besides, AHL analysts said, a fewer days in February compared to January and a reduction in the reliance on FO- (furnace oil) based power generation also caused declining the product demand in the month under review.
The breakdown of the data suggested that motor spirit (petrol) sales fell 11% to 0.56 million tons in February compared to January. High speed diesel sales plummeted 29% to 0.43 million tons. The consumption of furnace oil decreased 9% to 0.05 million tons compared to January.
On year-on-year basis, however, the demand for the petroleum product improved 2% this February compared to the same month of the last year.
The two analysts attributed the surge in sales with “resurgence of demand for MS amid lower price of petrol (on year-on-year basis), curbs on smuggled petroleum from Iran, jump in automobile sales, and higher demand for FO-based power generation.”
Contrary to the overall improvement in sales, the demand for HSD experienced a 4% decline this February compared to the same month of the last year.
“HSD sales fell…possibly due to lower demand, amid lower crop yields during the rabi harvest from reduced rainfall,” Khan said.
Accordingly, the product sales settled at 0.43 million tons in February 2025 compared to 0.45 million ton in February 2024.
Meanwhile, MS dispatches witnessed an uptick of 2% while sale of furnace oil sales increased 7% on year-on-year basis in February.
On a cumulative basis, total petroleum product sales for the first eight month of current fiscal year 2024-25 increased 4% compared to the same period of the last year, increasing to 10.55 million tons compared to 10.18 million tons on year-on-year basis.
Product-wise, petrol and high speed diesel showcased a growth, while furnace oil sales declined. The volumetric sales for motor spirit, HSD, and FO were 4.93 million tons, 4.49 million tons, and 0.46 million tons, respectively.
