{"id":12969,"date":"2026-05-18T16:57:29","date_gmt":"2026-05-18T11:57:29","guid":{"rendered":"https:\/\/ksestocks.com\/blog\/?p=12969"},"modified":"2026-05-18T18:45:20","modified_gmt":"2026-05-18T13:45:20","slug":"3-worst-performing-oil-gas-stocks-of-2026","status":"publish","type":"post","link":"https:\/\/ksestocks.com\/blog\/3-worst-performing-oil-gas-stocks-of-2026\/","title":{"rendered":"3 Worst Performing Oil & Gas Stocks Of 2026"},"content":{"rendered":"\n

Introduction<\/h2>\n\n\n\n

Pakistan\u2019s energy sector is entering 2026 with improving liquidity conditions, stronger exploration activity, and ongoing reforms aimed at reducing circular debt pressure across the system. Companies with diversified energy exposure, strong operational execution, lower leverage, and strategic expansion into mining, offshore exploration, and infrastructure are increasingly attracting investor attention. Based on the latest corporate briefings, quarterly results, and FY26 projections, three companies stand out within the sector: Pakistan Petroleum Limited<\/a><\/strong>, Mari Energies Limited<\/a><\/strong>, and Pakistan State Oil Company Limited<\/a><\/strong> .<\/p>\n\n\n\n

3. Pakistan Petroleum Limited (PPL<\/a>)<\/h2>\n\n\n\n

Pakistan Petroleum Limited<\/a><\/strong> remains one of the sector\u2019s key exploration and mineral diversification stories heading into 2026.<\/p>\n\n\n\n

FY2026 Financial Outlook<\/h3>\n\n\n\n
Key Financial Metric<\/th>FY2026 Estimate<\/th><\/tr><\/thead>
Net Sales<\/td>PKR 238.3 Billion<\/td><\/tr>
Profit After Tax<\/td>PKR 82.67 Billion<\/td><\/tr>
Earnings Per Share (EPS)<\/td>PKR 27.3<\/td><\/tr>
Dividend Per Share (DPS)<\/td>PKR 7.5<\/td><\/tr>
Payout Ratio<\/td>28%<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

Management expectations for FY26 remain supported by stronger exploration activity and improving liquidity trends.<\/p>\n\n\n\n

Liquidity Position Strengthened During 2QFY26<\/h3>\n\n\n\n

The company achieved a collection rate of 93%<\/strong> during 2QFY26, supporting improved cash flow visibility. PPL<\/a><\/strong> also maintained a strong cash balance of PKR 89 billion during early 2026. Despite these improvements, circular debt exposure within the gas sector remained substantial at PKR 599 billion. Management continues to view circular debt resolution as one of the largest liquidity catalysts for the company.<\/p>\n\n\n\n

Major Discovery Added Earnings Potential<\/h3>\n\n\n\n

A major operational development occurred during January 2026 with the Baragzai X-01 discovery in the Nashpa Block, where PPL<\/a><\/strong> holds a 30%<\/strong> stake. The well produced approximately 13,470 barrels of oil per day and 36.46 million standard cubic feet per day of gas. Management expects the discovery<\/strong> to contribute nearly PKR 5.04 per share toward earnings.<\/p>\n\n\n\n

Exploration Activity Increased Sharply<\/h3>\n\n\n\n

The company plans to spud more than 8 exploratory wells<\/strong> during FY26, representing a fourfold increase compared to the previous year. Management expects production recovery as LNG<\/strong> cargo diversions reduce domestic pipeline congestion and improve offtake from fields such as Sui and Kandhkot.<\/p>\n\n\n\n

Mining And International Expansion Continued<\/h3>\n\n\n\n

PPL maintains an effective 8.33%<\/strong> stake in the Reko Diq copper-gold project, which remains one of the company\u2019s most significant long-term strategic assets. The company also maintains investment exposure in the Baryte-Lead-Zinc project in Balochistan. Internationally, PPL<\/a><\/strong> continues to hold a 25%<\/strong> stake in Abu Dhabi\u2019s Offshore Block 5, where production activities are expected<\/strong> to support future earnings growth starting in 2028. Management also reduced its working interest in the Eastern Offshore Indus C Block to 35%<\/strong> in order to lower technical and capital risks while preserving exploration upside.<\/p>\n\n\n\n\n\n\n\n

2. Mari Energies Limited (MARI<\/a>)<\/h2>\n\n\n\n

Mari Energies Limited continues to attract attention due to its production resilience, aggressive offshore strategy, and diversification into mining and data infrastructure.<\/p>\n\n\n\n

FY2026 Financial Estimates<\/h3>\n\n\n\n
Key Financial Metric<\/th>FY2026 Estimate<\/th><\/tr><\/thead>
Net Sales<\/td>PKR 202 Billion<\/td><\/tr>
Profit After Tax<\/td>PKR 59.3 Billion<\/td><\/tr>
Earnings Per Share (EPS)<\/td>PKR 49.4 \u2013 50.0<\/td><\/tr>
Dividend Per Share (DPS)<\/td>PKR 20.0 \u2013 22.2<\/td><\/tr>
Expected Payout Ratio<\/td>Approximately 40%<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

The company is also projected to deliver 7%<\/strong> net positive production growth over the FY26\u201328 period, outperforming broader sector expectations.<\/p>\n\n\n\n

Offshore Exploration Strategy Expanded Aggressively<\/h3>\n\n\n\n

Management emphasized its \u201chigh-alpha\u201d exploration strategy during recent corporate interactions. The company secured more than 55,000 square kilometres of offshore acreage and now holds stakes in all 23 offshore blocks awarded during the latest bid round.<\/p>\n\n\n\n

Production Resilience Remained Strong<\/h3>\n\n\n\n

Despite sector-wide LNG-related curtailments, the company maintained a production CAGR of 1%<\/strong> over FY24\u201326. Sales volumes during 1HFY26 reached 39.13 MMBOE, reflecting positive year-on-year growth despite operational constraints<\/strong>.<\/p>\n\n\n\n

Spinwam And Ghazij Projects Add Long-Term Growth<\/h3>\n\n\n\n

Production from the Spinwam field has already commenced, contributing approximately 70 mmscfd<\/strong> of gas and 700 barrels per day of condensate. Management indicated that the field now contributes roughly 9% <\/strong>of the current company production. Meanwhile, the Ghazij and Shawal reservoirs are expected to reach production potential of 220 mmscfd by the second half of 2028.<\/p>\n\n\n\n

Mining And Data Center Expansion<\/h3>\n\n\n\n

A major strategic focus for the company is diversification beyond energy production. Through the Sky 47 initiative, MARI<\/a><\/strong> is developing two 5MW data centers in Islamabad and Karachi. Management expects this segment to contribute nearly 8\u201310%<\/strong> of future profitability once scaled. The company\u2019s mining subsidiary, Mari Minerals, is actively exploring copper and gold reserves in Balochistan\u2019s Chagai district. Management also transferred a 49%<\/strong> working interest in exploration licenses EL-322 and EL-323 to Globacore during early 2026.<\/p>\n\n\n\n

Reserve Replacement Continued To Lead The Sector<\/h3>\n\n\n\n

As of early 2026, the company achieved a sector-leading Reserve Replacement Ratio of 278%<\/strong>. Combined 2P and 2C reserves increased to a record 952 MMBOE.<\/p>\n\n\n\n\n\n\n\n

1. Pakistan State Oil Company Limited (PSO)<\/h2>\n\n\n\n

Pakistan State Oil Company Limited<\/a><\/strong> remains one of the key beneficiaries of ongoing energy sector reforms and liquidity improvement measures during 2026.<\/p>\n\n\n\n

FY2026 Financial Outlook<\/h3>\n\n\n\n
Key Financial Metric<\/th>FY2026 Estimate<\/th><\/tr><\/thead>
Net Sales<\/td>PKR 3,017.5 Billion<\/td><\/tr>
Profit After Tax<\/td>PKR 27.1 Billion<\/td><\/tr>
Earnings Per Share (EPS)<\/td>PKR 57.83<\/td><\/tr>
Dividend Per Share (DPS)<\/td>PKR 17.35<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

Management expectations for FY26 continue to improve as finance costs decline and receivable recoveries strengthen.<\/p>\n\n\n\n

Liquidity Position Improved Significantly<\/h3>\n\n\n\n

The company\u2019s receivables position has improved materially over the last two years. Trade debts declined from PKR 400 billion in late 2023 to PKR 288 billion by late 2025, followed by an additional reduction<\/strong> of PKR 14 billion during 2QFY26. Short-term borrowings also declined sharply<\/strong> from PKR 467 billion to PKR 325 billion. Combined with lower interest rates, finance costs reduced to PKR 11.4 billion during 1HFY26 compared to PKR 25.3 billion during 1HFY24. Management also highlighted that recovery ratios remained consistently between 100%<\/strong> and 104%<\/strong> through late 2025 and early 2026.<\/p>\n\n\n\n

Circular Debt Resolution Could Unlock Further Liquidity<\/h3>\n\n\n\n

PSO<\/a><\/strong> is expected to remain one of the major beneficiaries of power sector circular debt resolution efforts. Payments from CPPA-G are expected to flow toward the company through SNGPL<\/a><\/strong>, potentially improving overall liquidity dynamics further during FY26.<\/p>\n\n\n\n

Inventory And Fuel Portfolio Dynamics<\/h3>\n\n\n\n

The company\u2019s profitability outlook is also supported by inventory gains following recent fuel price increases. Management estimates inventory gains of PKR 26.74 per share, while additional upside could emerge if international crude prices remain elevated. PSO<\/a><\/strong> also has 69 RLNG cargoes scheduled for the remainder of CY26, averaging nearly 700 mmcfd.<\/p>\n\n\n\n

Latest Sales And Market Share Data<\/h3>\n\n\n\n

Industry figures for April 2026 showed that PSO<\/a><\/strong> maintained market leadership across major fuel categories. During the 10-month period ending April 2026, the company maintained 39%<\/strong> market share in Motor Spirit and 43%<\/strong> share in High-Speed Diesel. Monthly market share also improved by 1 percentage point in both segments during April 2026. Total fuel sales<\/strong> during April 2026 stood at 591,000 metric tons, including 247,000 tons of Motor Spirit and 251,000 tons of High-Speed Diesel.<\/p>\n\n\n\n

Conclusion<\/h2>\n\n\n\n

The energy sector\u2019s 2026 outlook is increasingly being shaped by liquidity recovery, higher exploration intensity, operational resilience, and strategic diversification beyond traditional hydrocarbons. While each company operates with a different business model, all three are benefiting from structural developments within Pakistan\u2019s energy landscape. Pakistan State Oil Company Limited<\/a><\/strong> remains heavily linked to improving circular debt dynamics, stronger recoveries, and fuel market leadership. Mari Energies Limited<\/a><\/strong> continues to differentiate itself through offshore expansion, reserve growth, mining exposure, and technology investments. Meanwhile, Pakistan Petroleum Limited<\/a><\/strong> is strengthening its long-term outlook through aggressive exploration activity, mineral projects, and improving liquidity trends. Based on the latest corporate briefing discussions, quarterly updates, and FY26 projections, these companies remain among the most closely watched energy plays on the Pakistan Stock Exchange for 2026.<\/p>\n","protected":false},"excerpt":{"rendered":"

Introduction Pakistan\u2019s energy sector is entering 2026 with improving liquidity conditions, stronger exploration activity, and ongoing reforms aimed at reducing circular debt pressure across the system. Companies with diversified energy exposure, strong operational execution, lower leverage, and strategic expansion into mining, offshore exploration, and infrastructure are increasingly attracting investor attention. Based on the latest corporate […]<\/p>\n","protected":false},"author":11,"featured_media":12961,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[182,201,166,417],"class_list":["post-12969","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-psx-blog","tag-mari","tag-ppl","tag-pso","tag-sngpl"],"featured_image_src":{"landsacpe":["https:\/\/ksestocks.com\/blog\/wp-content\/uploads\/2026\/05\/3-WORST-OIL-AND-GAS-STOCKS-940x445.jpg",940,445,true],"list":["https:\/\/ksestocks.com\/blog\/wp-content\/uploads\/2026\/05\/3-WORST-OIL-AND-GAS-STOCKS-463x348.jpg",463,348,true],"medium":["https:\/\/ksestocks.com\/blog\/wp-content\/uploads\/2026\/05\/3-WORST-OIL-AND-GAS-STOCKS-300x251.jpg",300,251,true],"full":["https:\/\/ksestocks.com\/blog\/wp-content\/uploads\/2026\/05\/3-WORST-OIL-AND-GAS-STOCKS.jpg",940,788,false]},"_links":{"self":[{"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/posts\/12969","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/users\/11"}],"replies":[{"embeddable":true,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/comments?post=12969"}],"version-history":[{"count":3,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/posts\/12969\/revisions"}],"predecessor-version":[{"id":12979,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/posts\/12969\/revisions\/12979"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/media\/12961"}],"wp:attachment":[{"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/media?parent=12969"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/categories?post=12969"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/tags?post=12969"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}