Petroleum Imports Up 2.2% in 11 Months: Mixed Impact on Energy and Industrial Stocks

What the petroleum import data showed

Pakistan's total imports for the petroleum group increased by 2.23% during the first eleven months of the current fiscal year (July 2025 to May 2026), reaching $14.95 billion compared to $14.63 billion in the same period last year. This rise was primarily driven by a substantial 27.29% increase in petroleum crude imports and a 2.86% increase in petroleum product imports. Liquefied Petroleum Gas (LPG) imports also saw a marginal rise of 0.10%.

Conversely, imports of Liquefied Natural Gas (LNG) experienced a sharp decline of 37.21% during this period. Other petroleum group products also saw a decrease of 19.19%. Looking at the month of May 2026 specifically, overall petroleum group imports were up by 7.84% year-on-year.

Here's a snapshot of the changes in import values:

Why it matters for energy and industrial stocks

The mixed trends in petroleum imports have varied implications for Pakistan's energy and industrial sectors. Increased crude and petroleum product imports generally signal higher demand or higher international prices, which can be positive for companies involved in refining and marketing these fuels. However, the significant drop in LNG imports is a concern, as LNG is a critical fuel source for power generation and industrial use, including the fertilizer sector. A reduction in LNG supply often translates to gas curtailment, impacting the operations and profitability of gas utilities and industries that rely on this fuel.

Which stocks, and why

For refineries, the substantial increase in petroleum crude imports, by value, suggests higher throughput or potentially higher international crude oil prices. This is generally positive for their business activity and could lead to inventory gains if they hold crude stock. Companies like National Refinery, Attock Refinery, and Pakistan Refinery could see a low positive impact over the long term, assuming stable refining margins.

Oil Marketing Companies (OMCs), such as Pakistan State Oil, Attock Petroleum, and Shell Pakistan, also benefit from the increase in petroleum product imports. This indicates either higher sales volumes or higher international product prices, both of which are generally positive for their operations. The impact is likely low positive and long-term, depending on their ability to pass on costs and manage inventory.

The sharp decline in LNG imports is a negative development for gas utilities like Sui Northern Gas Pipelines and Sui Southern Gas Company. LNG is a major component of Pakistan's gas supply, and reduced imports can lead to lower gas availability for distribution, potentially impacting their sales volumes and ability to meet demand. This could have a medium negative impact over the long term.

Fertilizer manufacturers are also significantly exposed to gas supply. Companies like Engro Fertilizers, Fauji Fertilizer, Fatima Fertilizer, and Fauji Fertilizer Bin Qasim rely heavily on gas as feedstock for urea production. A reduction in LNG imports increases the risk of gas curtailment, which directly affects their production capacity and profitability. This is a medium negative impact for these pure-play fertilizer companies over the long term. Engro Corporation, as a diversified conglomerate with a significant fertilizer stake, would also face a low negative impact.

For power generation companies, particularly those using gas or RLNG as fuel, lower LNG imports could lead to fuel shortages, potentially forcing them to switch to more expensive alternatives like furnace oil or face reduced dispatch. This could impact their operational costs and efficiency. K-Electric, being a vertically integrated utility, faces a medium negative impact due to higher generation costs. Other IPPs like Hub Power, Nishat Power, and Kot Addu Power could experience a low negative impact, as their capacity payments provide some cushion, but fuel mix and efficiency can still be affected.

What to watch

Investors should monitor future reports from the Pakistan Bureau of Statistics (PBS) for trends in petroleum import volumes, not just values, to better gauge demand and supply dynamics. Additionally, keeping an eye on international crude oil and LNG prices will be crucial, as these directly influence Pakistan's import bill and the profitability of local energy companies. Any policy decisions regarding gas allocation or power tariffs in response to fuel availability will also be important indicators for the affected sectors.