Pakistan’s January lube demand rises

Pakistan’s lubricating oil demand rose to a four-month high in January amid a rebound in industrial oils consumption.

But consumption stayed lower than typical levels as the country’s economy struggled with multiple challenges.

Those challenges had yet to have a significant impact on the country’s base oils imports, which rose strongly in the second half of last year.

The firm imports contrasted with a sustained slowdown in Pakistan’s base oils production. Output fell in January for the seventh time in eight months.

The country’s base oils production consists of Group I base oils. Its imports consist more of premium-grade base oils.

Pakistan’s rising consumption of premium grades as a share of total consumption helped to cushion the impact of its falling lube demand.

But weak lube consumption and balance of payments issues were likely to limit any additional rise in requirements for overseas supplies.

More muted demand would follow a fall in India’s base oils imports in recent months, leaving overseas suppliers targeting other markets instead.

Pakistan’s lube consumption of close to 11,500t in January rose from around 10,900t the previous month to the highest since September, according to Oil Companies Advisory Council (OCAC).

Demand also rose from year-earlier levels for the first time in seven months mostly because of a rebound in consumption of industrial oils.

Demand for industrial lubricants rose to a seven-month high despite slumping automobile production.

Consumption of transport lubricants also rose, but less sharply.

The rise in lube demand partly reflected the low comparison relative to consumption in recent months.

Lube consumption had averaged more than 13,000 t/month in the year to June 2022. It averaged less than 11,000 t/month since then.