Pakistan’s furnace oil (FO) sales climbed to a 27-month high in April 2026, reflecting a sharp rebound in demand despite the imposition of a petroleum levy on the fuel in last year’s budget.
According to data compiled by Topline Securities based on figures from the Oil Companies Advisory Council (OCAC), furnace oil sales reached 136,672 tonnes in April 2026, the highest monthly volume recorded since January 2024.
The latest figure represents a significant increase from 87,667 tonnes in March 2026 and more than triple the 44,285 tonnes recorded in February. Demand has been steadily recovering since late 2025 after remaining subdued for much of the previous two years.
The resurgence comes as local refineries have increased production, while limited availability of regasified liquefied natural gas (RLNG) has forced power producers and industrial users to seek alternative fuel sources.
Industry analysts said furnace oil is increasingly being used to bridge energy supply gaps, particularly when gas-based generation faces fuel constraints. The trend 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 a policy preference for LNG and renewable energy sources.
The recovery is especially significant given that the government imposed a petroleum levy on furnace oil in the FY2025-26 budget, a move that many industry observers expected would further suppress demand.
Instead, operational realities in the energy sector have outweighed the impact of higher taxation. The combination of stronger refinery output, intermittent fuel shortages, and rising electricity demand has helped revive furnace oil consumption.
Historically, furnace oil was once Pakistan’s dominant power generation fuel before being gradually replaced by imported LNG, coal, hydropower, nuclear energy, and renewable sources. However, recent supply challenges have highlighted its continued importance as a backup energy source.
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