High fuel prices keep Pakistan’s oil demand flat in FY26 as June sales fall 20%

Higher fuel prices, increased petroleum levies and subdued economic activity kept Pakistan’s oil demand under pressure in FY26, with oil marketing companies’ annual sales staying almost flat at 16.191 million tonnes while June volumes fell 20% year-on-year to 1.258 million tonnes, according to a sales update by Intermarket Securities citing Oil Companies Advisory Council (OCAC) data.

On a month-on-month basis, OMC sales recovered 7% from 1.172 million tonnes in May 2026.

The report said higher petroleum prices, a higher petroleum development levy and subdued economic activity kept demand under pressure during the year, particularly in the second half of FY26 amid tensions in the Middle East.

Motor spirit sales stood at 649,000 tonnes in June, down 11% from 732,000 tonnes in June 2025 but up 5% from 617,000 tonnes in May. For FY26, motor spirit sales increased 1% to 7.677 million tonnes, compared with 7.599 million tonnes in FY25.

High-speed diesel sales fell 20% year-on-year to 497,000 tonnes in June from 618,000 tonnes last year. On a monthly basis, HSD sales rose 9% from 455,000 tonnes in May. Annual HSD volumes stood at 6.851 million tonnes in FY26, slightly lower than 6.891 million tonnes in FY25.

Furnace oil remained the weakest segment, with sales declining 68% year-on-year to 41,000 tonnes in June from 129,000 tonnes last year. However, furnace oil sales rose 41% compared with 29,000 tonnes in May. Full-year furnace oil demand fell 26% to 599,000 tonnes from 806,000 tonnes in FY25.

Sales of other petroleum products stood at 70,000 tonnes in June, down 18% year-on-year and 2% month-on-month. For FY26, these sales rose 4% to 1.064 million tonnes from 1.026 million tonnes last year.

Company-wise, Pakistan State Oil (PSO) sold 527,000 tonnes in June, down 20% from 661,000 tonnes in June 2025 but up 2% from 518,000 tonnes in May. Its FY26 volumes declined 4% to 6.872 million tonnes from 7.188 million tonnes in FY25.

PSO’s motor spirit sales fell 21% year-on-year to 252,000 tonnes in June, while HSD sales declined 22% to 211,000 tonnes. Furnace oil sales dropped 83% to 2,000 tonnes.

Attock Petroleum Limited (APL) recorded sales of 104,000 tonnes in June, down 21% from 132,000 tonnes last year but up 7% from May. Its full-year volumes fell 7% to 1.332 million tonnes from 1.429 million tonnes.

APL’s motor spirit sales declined 7% year-on-year to 54,000 tonnes, while HSD sales fell 16% to 43,000 tonnes. Furnace oil sales declined 78% to 4,000 tonnes.

WAFI Energy sold 117,000 tonnes in June, down 8% year-on-year but up 13% from May. During FY26, WAFI’s sales rose 10% to 1.320 million tonnes from 1.200 million tonnes.

WAFI’s motor spirit sales remained flat year-on-year at 69,000 tonnes in June, while HSD sales declined 5% to 46,000 tonnes. On an annual basis, its motor spirit sales rose 3% to 731,000 tonnes and HSD sales increased 23% to 521,000 tonnes.

Gas & Oil Pakistan Limited (GO) recorded sales of 119,000 tonnes in June, down 31% from 174,000 tonnes last year and 3% lower than May. However, its FY26 sales increased 9% to 1.867 million tonnes from 1.707 million tonnes in FY25.

GO’s motor spirit sales fell 2% year-on-year to 76,000 tonnes in June, while HSD sales dropped 55% to 42,000 tonnes. The report said GO remained the weakest performer in HSD during the month, likely due to supply disruptions in the Middle East.

In terms of market share, PSO recorded the largest decline among major OMCs during FY26, with its share falling by 1.6 percentage points to 42.4%. GO and WAFI were the main gainers, with their shares rising by 1.1 percentage points and 0.8 percentage points to 11.5% and 8.2%, respectively.

The report said OMC sales remained subdued in June as high oil prices weighed on economic activity. It added that volumes could recover after the easing of Middle East tensions, lower oil prices, lifting of business curbs and a more growth-focused FY27 budget.

However, it said recovery would depend on continued enforcement against smuggling, which remains attractive due to high taxes on petroleum products.