Pakistan’s refinery sector saw a slowdown in May 2026. Total refinery upliftment dropped by 7 percent compared to the same month last year. Production fell to 927,000 tons from 997,000 tons in May 2025.
The main reason for this decline is weak demand for high-speed diesel (HSD). Diesel consumption dropped sharply by over 19 percent. Oil marketing companies lifted less diesel due to high prices and wider price gaps with neighbouring countries. Furnace oil (FO) demand also decreased, while petrol showed only slight growth.
Experts say changing fuel consumption patterns are affecting the energy sector. Higher fuel prices, economic slowdown, and reduced industrial activity have lowered overall demand. Many people and businesses are using less diesel for transport and power generation.
This situation is challenging for local refineries. Lower production means less income and possible pressure on refinery margins. The industry plays a key role in meeting Pakistan’s fuel needs and supporting the economy.
Analysts believe this trend may continue in the coming months unless fuel prices become more affordable or economic activity improves. The government and industry are watching the situation closely to manage supply and keep the sector stable.
