Local refineries’ gross refining margins declined 7% to $5.39 per barrel in October on a monthly basis.
Reduction in crude oil prices of 3% and decline in light distillates by 5% led to the decline, according to an Elixir Securities research note.
Among light distillates, petrol spread witnessed a noteworthy decline of 92% to $0.42 per barrel primarily due to cheap imports by Pakistan State Oil, says the note.
With 35% of its product slate comprising light distillates, Attock Refinery margins registered the highest decline of 14% to average at $4.84 per barrel. National Refinery’s margins declined 5% to $6.62 while Pakistan Refinery margins rose marginally to $2.52 per barrel during October.
Amongst middle distillates, expectation of high heating oil demand from the West during winter led to a limited decline of 1.4% in gasoil prices, despite demand from top buyers India and Indonesia. Gasoil spread widened by 4% to $13.38 per barrel.
Furthermore, furnace oil discount to crude oil witnessed a marginal improvement of $2.2 to $9.23 per barrel, due to tight supply condition on the back of lack of inflows from the West.
Published in The Express Tribune, November 3rd, 2011.
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