Pakistan’s furnace oil sales rose to a 27-month high in April 2026, signalling a sharp recovery in demand despite the petroleum levy imposed on the fuel in last year’s budget.
According to data compiled by Topline Securities on the basis of figures from the Oil Companies Advisory Council, furnace oil sales reached 136,672 tonnes in April 2026, marking the highest monthly level since January 2024.
The latest sales figure shows a strong jump from 87,667 tonnes in March 2026 and more than three times the 44,285 tonnes recorded in February, indicating that demand for furnace oil has been steadily rebounding since late 2025 after remaining weak for much of the previous two years.
Industry analysts said the increase has been driven by higher output from local refineries and limited availability of regasified liquefied natural gas, which has forced power producers and industrial users to turn to alternative fuel sources.
They said furnace oil is increasingly being used to fill energy supply gaps, especially when gas-based power generation faces fuel shortages. The development marks a notable shift for a fuel that had largely been pushed out of Pakistan’s energy mix over the past decade due to environmental concerns and the government’s preference for LNG and renewable energy.
The recovery in furnace oil demand is particularly significant because the government had imposed a petroleum levy on the fuel in the FY2025-26 budget, a move widely expected to further discourage its use.
However, analysts said the realities of the energy sector have outweighed the impact of higher taxation. They noted that rising electricity demand, stronger refinery production, and intermittent fuel shortages have combined to support a renewed increase in furnace oil consumption.
Historically, furnace oil was once the main fuel used for power generation in Pakistan before gradually being replaced by imported LNG, coal, hydropower, nuclear energy, and renewable sources. But recent supply constraints have once again underlined its role as an important backup fuel in the country’s energy system.
