Pakistan’s oil marketing sector has emerged as an unlikely barometer of economic resilience, with January 2025 petroleum consumption data revealing dual narratives: sustained consumer spending power driving petrol demand and a diesel-led industrial revival defying macroeconomic headwinds. The latest reports from Topline Securities and Arif Habib Ltd. paint a picture of an economy navigating challenges through shifting fuel consumption patterns, offering cautious optimism for fiscal year 2025.
Pakistan’s oil marketing companies (OMCs) reported flat year-over-year total petroleum sales of 1.38 million tons in January 2025, masking significant sectoral shifts beneath the surface. The stability comes despite a 1% month-over-month increase in petrol and diesel prices, suggesting demand inelasticity in key economic segments.
Let us take a look at the key figures from January, released by the Oil Companies Advisory Council, an industry group. They indicate that petrol consumption was up 1% year-on-year and 10% month-on-month during January 2025. Petrol is mostly consumed by urban commuters and is seen as among the most sensitive to inflationary pressures. When prices get beyond the purchasing power of most consumers, they tend to cut back on discretionary driving, which reduces petrol consumption in the country.
Diesel consumption, meanwhile, was up 17% year-on-year and about 5% month-on-month during January 2025. Diesel is mostly used in commercial transportation and agriculture, which may indicate a pickup in commercial and agricultural activity in the country.
The 7-month cumulative figures for the fiscal year ending June 30, 2025 show clearer growth trajectories, with total petroleum sales up 4% year-on-year to 9.41 million tons, led by diesel’s 11% year-on-year surge.Â
The 5% year-on-year growth in petrol sales through 7MFY25 to 4.37 million tons reveals surprising consumer resilience. This sustained demand comes despite average petrol prices remaining 20-25% higher than pre-2023 levels. Meanwhile, persistent inflationary pressures (CPI averaging 28% in fiscal year 2024), and disposable income erosion from currency depreciation cannot have helped matters.
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