Refineries Swing to Massive Rs. 54.8 Billion Profit in FY26 After Prior-Year Loss

Pakistan's listed refineries turned profitable in FY26, posting a Rs. 54.8 billion profit after suffering a Rs. 10.5 billion loss the previous year. The recovery was driven by surging margins on petrol and diesel refining, higher production, and increased sales, according to Arif Habib Limited. Sector revenue grew by 26.9 percent to Rs.

1.54 trillion, while gross profit jumped to Rs. 107.4 billion. Gross margins expanded to 7 percent from 0.9 percent, and net profit margins reached 3.6 percent. Stronger fuel prices and higher refinery activity fueled the revenue growth. Ex-refinery prices of petrol and diesel rose 17 percent and 19 percent, respectively, with total petroleum product production up 13.4 percent to 11.2 million tons.

Refinery utilization improved to 55 percent from 48 percent. Diesel production surged 17.2 percent, while petrol production rose 12.4 percent. Diesel accounted for 50.3 percent of total refinery output, up from 48.6 percent. Furnace oil's share declined to 21.1 percent. Total refinery sales increased 8.6 percent to 10.8 million tons, with diesel sales up 13.6 percent and petrol sales 11 percent.

Furnace oil sales fell 7.8 percent as power sector demand waned. Margins on diesel and petrol improved significantly, with diesel margin reaching $29 per barrel and petrol margin up to $7.4 per barrel. The strong performance was attributed to supply disruptions and international cargo procurement challenges following the US-Iran conflict.

Attock Refinery's profit jumped 85 percent to Rs. 22.1 billion, while Pakistan Refinery returned to a profit of Rs. 15.8 billion. Cnergyico PK Limited and National Refinery also turned profitable, with earnings of Rs. 10.8 billion and Rs. 6.2 billion, respectively. The recovery was mainly in the first three quarters, with sector gross profit falling to Rs. 8.0 billion in the fourth quarter, though revenue still rose 27 percent.