Oil marketing companies (OMCs) in Pakistan reported an 8% month-on-month increase in sales, reaching 1.4 million metric tons (MT) in January 2025, according to a report by brokerage firm IMS Research.
However, volumes remained flat compared to the same month last year, as a sharp 68% year-on-year decline in furnace oil (FO) sales offset gains in other petroleum products. Petrol (MS) sales remained unchanged year-on-year, while high-speed diesel (HSD) saw a strong 17% increase.
The recovery in OMC sales was primarily driven by stricter enforcement against smuggling, improved purchasing power due to easing inflation, and lower fuel prices.
HSD sales continued their upward trend, rising to approximately 600,000 MT, reflecting a 17% annual increase and a 5% rise from December 2024.
Petrol demand remained stable compared to January 2024 but grew 10% month-on-month to around 625,000 MT. This increase was supported by improved visibility following reduced smog in upper Sindh and Punjab, the reopening of schools after winter break, and tighter restrictions on petrol smuggling.
Furnace oil sales, which have been declining due to the shift from residual fuel oil (RFO)-based power plants to cheaper coal and RLNG alternatives, dropped 68% year-on-year but saw a temporary 40% month-on-month increase to 58,000 MT. The rise was driven by seasonal winter demand amid lower hydropower generation.
Among the top five OMCs, Pakistan State Oil (PSO) lost 3 percentage points of market share, while Attock Petroleum Limited (APL), Gas & Oil Pakistan (GO), and Hascol gained 0.8, 2.5, and 0.6 percentage points, respectively.
PSO’s share in petrol sales declined by 1 percentage point to 40%, while smaller OMCs gained market share.
Over the first seven months of FY25, both PSO and APL lost approximately 5 percentage points in petrol market share due to increased competition and smuggling.
Overall, PSO’s market share fell 2.1 percentage points month-on-month to 42.8%, mainly due to competition in petrol and diesel sales. In contrast, GO expanded its market presence to 10.9%, reflecting a 7-percentage-point annual increase. APL’s market share also increased by 0.8 percentage points to 9.5%.
According to the brokerage report, the OMC sector continues to recover, supported by anti-smuggling measures and a normalization of fuel consumption. However, growing competition from smaller OMCs remains a challenge.
Looking ahead, demand is expected to rise moderately due to seasonal agricultural activity and higher temperatures. However, potential increases in petroleum prices under International Monetary Fund (IMF) directives could weigh on consumption.
