Pakistan’s fuel sales drop 22% in July amid monsoon disruptions and price hikes

Pakistan’s petroleum sales dropped 22% month-over-month in July to 1.22 million metric tons, as heavy monsoon rains, flooding and higher domestic fuel prices, including a new carbon levy, dampened demand across key segments.

According to industry data, the steep monthly decline was driven by a combination of logistical disruptions from nationwide rainfall and a surge in fuel prices. The prices of petrol and high-speed diesel rose 6.5% and 9.4% respectively in July, following an increase in global oil prices and the imposition of a PKR 2.5-per-liter Carbon Sustainability Levy (CSL).

Petrol sales fell 16% MoM to 0.61 million tons, diesel sales dropped 18% MoM to 0.51 million tons, and furnace oil (FO) sales plunged 88% MoM to just 0.02 million tons, due to reduced demand for power generation during the cooler, rain-heavy month.

Despite the sharp monthly contraction, overall fuel sales rose 2% year-over-year (YoY), buoyed by improved economic activity, lower smuggling from Iran, and higher auto sales. Petrol and diesel volumes climbed 4% and 9% YoY respectively, while FO volumes declined 80%.

PSO, APL lose ground

Pakistan State Oil (PSO), the market leader, saw its July sales fall 7% YoY to 0.51 million tons. Its petrol and diesel sales both slipped 3%, while FO volumes dropped 93%. PSO’s market share declined to 41.6%, down 4 percentage points from July 2024.

Attock Petroleum Ltd. (APL) posted a 3% YoY drop in volumes to 0.10 million tons, with its market share easing to 8.1%.

In contrast, Wafi Energy Pakistan Ltd. (WAFI) and Hascol Petroleum Ltd. (HASCOL) posted solid YoY growth. WAFI’s sales surged 22% YoY, raising its market share to 8.6%, while HASCOL grew 16% YoY to capture 3.7% of the market.

Gas & Oil Pakistan Ltd. (GO) recorded the most notable improvement, expanding its share to 14.2% in July, up from 8.9% a year earlier. The combined share of smaller oil marketing companies (OMCs) fell to 23.8%.

Revenue collections and FY26 targets

The government collected approximately PKR 107 billion in petroleum levy (PL) in July, alongside PKR 3.56 billion in CSL revenue.

The federal government has set a revised PL target of PKR 1,468 billion for fiscal year 2025-26, implying a monthly average of PKR 112 billion.

The July downturn follows a solid performance in June, when total OMC sales reached 1.57 million tons, up 8% YoY and 2% MoM, driven by economic recovery and reduced fuel smuggling amid the Iran-Israel conflict. That brought FY25 cumulative sales to 16.32 million tons, reflecting a 7% YoY growth.

Analysts expect oil sales in FY26 to grow between 7% and 10%, contingent on weather patterns, global price trends, and domestic demand recovery.