Pakistan’s listed refinery sector swung back to a profit of Rs. 54.8 billion in FY2026 from a Rs. 10.5 billion loss a year earlier, as stronger petrol and diesel refining margins, higher production and increased sales supported a sharp recovery in earnings, according to a report by Arif Habib Limited.
Sector revenue increased 26.9 percent to Rs. 1.54 trillion from Rs. 1.22 trillion in FY2025, while gross profit surged to Rs. 107.4 billion from Rs. 10.4 billion. As a result, the sector’s gross margin improved to 7 percent from 0.9 percent, while the net profit margin stood at 3.6 percent.
Higher fuel prices and increased refinery activity supported the revenue growth. Ex-refinery prices of motor spirit, or petrol, and high-speed diesel rose 17 percent and 19 percent, respectively, while total petroleum product production increased 13.4 percent to 11.2 million tons. Refinery utilization consequently improved to 55 percent from 48 percent in FY2025.
Diesel production rose 17.2 percent, while petrol production increased 12.4 percent. Diesel accounted for 50.3 percent of total refinery output, up from 48.6 percent a year earlier. Furnace oil’s share declined to 21.1 percent from 23.1 percent, while jet petroleum’s contribution increased to 4.9 percent from 4.4 percent.
Total refinery sales increased 8.6 percent to 10.8 million tons, led by a 13.6 percent rise in diesel sales and an 11 percent increase in petrol sales. Furnace oil sales, however, fell 7.8 percent as demand from the power sector weakened.
Refining margins provided a major boost to profitability. The diesel margin against Arab Light crude climbed to $29 per barrel from $9.7 per barrel, while the petrol margin increased to $7.4 per barrel from $2.9 per barrel. Arif Habib Limited attributed the stronger diesel margin partly to supply disruptions and more difficult international cargo procurement following heightened geopolitical tensions after the US Iran conflict began in March 2026.
At the company level, Attock Refinery posted an 85 percent increase in profit to Rs. 22.1 billion and declared a dividend of Rs. 17.50 per share. Pakistan Refinery returned to a profit of Rs. 15.8 billion from a Rs. 4.7 billion loss, despite a 1.7 percent decline in sales volume.
Cnergyico PK Limited also returned to profit, earning Rs. 10.8 billion compared with a Rs. 2.9 billion loss a year earlier, as petroleum product sales increased 12.3 percent. National Refinery posted a profit of Rs. 6.2 billion against a Rs. 14.9 billion loss in FY2025, although its earnings were affected by about Rs. 13.5 billion in policy and accounting charges.
The recovery was concentrated in the first three quarters of FY2026. In the fourth quarter, sector gross profit dropped to Rs. 8.0 billion from Rs. 72.2 billion in the preceding quarter, even as revenue increased 27 percent to Rs. 530.8 billion. The report’s FY2026 earnings chart on page 4 also shows the sector’s profit after tax reaching about Rs. 55 billion, compared with a loss in FY2025.
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