The oil marketing companies sector in Pakistan recorded an increase in profits by 39 % on an annual basis during the first half of the fiscal year 2025 (1HFY25), reaching 18.2 billion rupees compared to 13.2 billion rupees in the same period last year.
The increase in profitability was largely driven by lower financial costs and low taxes, although the total sales revenue decreased.
According to reports, sales at the sector level decreased by 11 % on an annual basis, which amounted to 2.1 trillion rupees. This decrease is primarily due to the decrease in fuel prices, with a decrease in retail rates for gasoline and high -speed diesel by 10 % and 9 %, respectively, compared to the previous year. Although revenue has decreased, OMCS has seen 4 % growth in sales volume, driven by 5 % increase in sending gasoline and 10 % increase in diesel sales.
Among the main players in the industry, Pakistan (PSO) has recorded the most important growth in profits, with three -fold profits throughout the year. In contrast, Attock Petroleum Limited (APL) and Wafi (previously paralyzed Pakistan Ltd.) witnessed a decrease in profitability. Hi-Tech Shocants Limited (HTL) managed to significantly reduce its financial losses, supporting strong sales in lubricants and petroleum products.
The scene of the market share, with a decrease in PSO in oil sales, turned to 41 % in February 2025, a decrease from 51 % in the same month last year. During the eight months of July 2024 to February 2025, PSO maintained a 45 % market share.
On the contrary, Pakistan’s gas and oil expanded its mark, which increased its share in the market from 3 % in February 2024 to 13 % per year, reflecting its increasing presence in this sector.
The OMC sector has also faced challenges due to the inventory losses caused by the decrease in the filter, which reduced a little of the total total margins to 3.4 % in 1HFY25 of 3.5 % in the same period last year.
However, financial stability improved, as the sector’s financing costs decreased by 22 % on an annual basis, mainly due to the low interest rates and low -term loans, especially by PSO and HTL. The actual tax rate of the sector also decreased from 67 % in 1HFY24 to 53 % in 1HFY25, which supports profit growth.
The government is expected to review OMC margins, which can provide another batch of sector profits. In addition, the decrease in international oil prices and improving the total economic conditions will maintain the demand for fuel products in the coming months.
The circular debt solution still represents a major challenge, as the PSO commercial debt from Sui Nortern Gas Pipelines Limited (SNGPL) is 262 billion rupees as of December 2024, a decrease from 275 billion rupees in September 2024.
With the expectation of increasing the financing of consumer cars and other discounts in gasoline and diesel prices, the sector remains ready for potential stability in the near future, provided that the global fuel market trends remain favorable.
