Pak-Arab Refinery Limited (PARCO) has issued a sales tender for 50,000 tons of surplus fuel oil as Pakistan resorts to exporting the distillate amid rising domestic preference towards coal for power generation.
PARCO is selling 50,000 tons of high-sulfur fuel oil (HSFO) with a maximum sulfur ratio of 3.5 percent for loading at Karachi port between July 15 and 17.
To note, fuel oil imports into Pakistan fell in the second quarter of this year as companies burned more coal for power generation due to its lower cost and availability.
Pakistan exported 90,000 tons of surplus fuel oil in May 2023 due to poor local demand in recent months.
Fuel oil exports reached 250,000 tons during March-May 2023, with more exports planned in the coming days as consumption of fuel oil has not increased, reported a national daily.
Over 510,000 tons of fuel oil is now stored in Pakistan by oil marketing companies (OMCs), power stations, and local refineries.
Local and worldwide prices of fuel oil differed by Rs. 35,000 per ton but refineries have been exporting their stockpiles to ensure the seamless functioning of their operations, which would have taken an even bigger beating if the excess fuel wasn’t sold off.
Pertinently, PARCO and PRL have so far held the most fuel oil among local refineries, and they have decided to export it rather than hope that local consumption would recover later.
Source: Pro Pakistani