KARACHI: The refining sector posted a mixed performance in May 2026, with refinery product offtake declining despite a sharp increase in production, highlighting mounting challenges in the domestic fuel market.
According to industry data, overall refinery offtake fell 7.0 per cent year-on-year (YoY) in May, largely due to weaker demand for high-speed diesel (HSD) and furnace oil (FO).HSD sales declined 19.1 per cent YoY to 409,000 tonnes, reflecting lower procurement by oil marketing companies (OMCs) and the growing impact of fuel smuggling. Industry estimates suggest that around 5,000 tonnes of HSD are smuggled into Pakistan each day, compared with national demand of approximately 22,000 tonnes per day, meaning illicit supplies account for nearly 23 per cent of total diesel consumption.
Motor spirit (MS) remained comparatively resilient, with offtake rising 4.3 per cent YoY to 247,000 tonnes during the month.Despite the slowdown in May, cumulative refinery offtake during the first 11 months of FY2026 reached 9.9 million tonnes, up 10.4 per cent YoY, supported by stronger demand for petrol and diesel. MS offtake increased 10.8 per cent, while HSD demand rose 17.1 per cent during the period.
Among refiners, Attock Refinery Limited (ATRL) recorded sales of 112,000 tonnes in May, down 16.6 per cent YoY. Petrol sales rose 26.6 per cent to 50,000 tonnes, but HSD and FO sales fell 12.9 per cent and 78.5 per cent, respectively. The company’s market share slipped to 12.1 per cent, below its historical average of 13.7 per cent.
Pakistan Refinery Limited (PRL) posted a 3.4 per cent YoY increase in sales to 144,000 tonnes, supported by a 30.6 per cent YoY rise in furnace oil volumes.National Refinery Limited (NRL) reported the strongest growth among the major refiners, with sales increasing 21.2 per cent YoY to 135,000 tonnes, driven by higher petrol and furnace oil sales.
Meanwhile, Cnergyico (CNERGY) recorded an 11.5 per cent YoY decline in sales to 152,000 tonnes, as petrol and diesel volumes fell 22.3 per cent and 17.7 per cent, respectively.
In contrast to weaker sales, refinery production expanded significantly during May. Total industry production rose 22.5 per cent YoY to 1.01 million tonnes, supported by higher output across key products.
Diesel production increased 17.6 per cent YoY to 492,000 tonnes, petrol output rose 14.4 per cent to 242,000 tonnes, while furnace oil production surged 37.9 per cent to 224,000 tonnes.The increase in production, coupled with weaker sales, suggests a build-up in refinery inventories during the month.
Industry utilisation improved to 59.2 per cent in May, compared with 58.1 per cent in April 2026 and 48.3 per cent in May 2025, indicating stronger operational activity despite demand-side challenges.
PRL posted the highest utilisation rate at 73.5 per cent, followed by ATRL at 69.3 per cent, while NRL operated at 57.0 per cent.Cnergyico recorded the lowest utilisation rate at 22.4 per cent, reflecting subdued operational activity compared with its industry peers.
Industry throughput patterns remained mixed, with diesel accounting for 48.7 per cent of total throughput, while petrol and furnace oil represented 24 per cent and 22.2 per cent, respectively.
