Pakistan’s listed refineries have turned things around in a big way. The sector swung to a profit of Rs. 54.8 billion in FY2026, reversing a Rs. 10.5 billion loss from the year before. Stronger refining margins, higher production and increased sales all played a part, according to a report by Arif Habib Limited.

Sector revenue climbed 26.9 percent to Rs. 1.54 trillion from Rs. 1.22 trillion in FY2025. Meanwhile, gross profit surged to Rs. 107.4 billion from just Rs. 10.4 billion. As a result, the sector’s gross margin improved to 7 percent from 0.9 percent, while the net profit margin came in at 3.6 percent.

Higher fuel prices and busier refineries drove much of this growth. Ex-refinery prices of petrol and high-speed diesel rose 17 percent and 19 percent respectively. Additionally, total petroleum product production increased 13.4 percent to 11.2 million tons. Refinery utilization, therefore, improved to 55 percent from 48 percent a year earlier.

Diesel output rose 17.2 percent, while petrol production increased 12.4 percent. Diesel now makes up 50.3 percent of total refinery output, up from 48.6 percent previously. Furnace oil’s share slipped to 21.1 percent from 23.1 percent, whereas jet petroleum’s contribution rose to 4.9 percent from 4.4 percent.

Total refinery sales grew 8.6 percent to 10.8 million tons. Diesel sales led the way with a 13.6 percent rise, while petrol sales climbed 11 percent. Furnace oil sales, however, fell 7.8 percent as demand from the power sector weakened.

Refining margins gave profitability a major lift. The diesel margin against Arab Light crude jumped to $29 per barrel from just $9.7 per barrel. Similarly, the petrol margin increased to $7.4 per barrel from $2.9 per barrel. Arif Habib Limited linked the stronger diesel margin partly to supply disruptions and tougher international cargo procurement, following heightened tensions after the US-Iran conflict began in March 2026.

Individual companies also had a strong showing. Attock Refinery posted an 85 percent jump in profit to Rs. 22.1 billion and declared a dividend of Rs. 17.50 per share. Pakistan Refinery returned to profit with Rs. 15.8 billion, despite a 1.7 percent dip in sales volume. Cnergyico PK Limited likewise swung back to profit, earning Rs. 10.8 billion as petroleum product sales rose 12.3 percent. National Refinery posted Rs. 6.2 billion in profit, though roughly Rs. 13.5 billion in policy and accounting charges weighed on its earnings.

Still, the recovery was not evenly spread across the year. Most gains came in the first three quarters, and fourth-quarter gross profit dropped sharply to Rs. 8.0 billion from Rs. 72.2 billion in the prior quarter. Even so, revenue for that quarter rose 27 percent to Rs. 530.8 billion, showing demand held firm even as margins narrowed.