Pakistan’s benchmark index ends the week at 170,765 points as geopolitical developments and oil-price movements keep investors cautious.
KARACHI: The KSE-100 Index recorded a marginal weekly decline as developments surrounding US-Iran talks and movements in international oil prices kept investors cautious.
According to research by Arif Habib Limited (AHL), the benchmark index closed at 170,765 points, down 0.1% week-on-week (WoW) from 170,885 points in the previous week.
The market initially drew support from expectations of progress in US-Iran negotiations and softer oil prices. However, renewed geopolitical concerns and a subsequent rise in oil prices weighed on sentiment towards the end of the week.
Power generation rises 5.1%
Pakistan’s power generation increased 5.1% year-on-year (YoY) to 14,943 GWh in August 2026, marking the third-highest generation level recorded for the month.
The increase was supported by higher generation from hydel, coal, gas and wind sources. AHL data showed hydel remained the largest source, while coal-based generation also recorded a significant increase.
However, the average cost of power generation climbed 38% YoY to Rs10.01 per kWh, mainly because of a more expensive RLNG and furnace-oil mix and elevated international oil prices.
As a result, distribution companies sought a positive fuel cost adjustment (FCA) of around Rs1.73 per kWh for August. The Central Power Purchasing Agency has sought an adjustment of Rs1.7267 per unit, subject to regulatory determination.
Oil production edges higher, gas output declines
Pakistan’s oil production rose 1.4% WoW to 68.5 thousand barrels per day (bopd), mainly because of increased flows from the Makori East, Maramzai and Mardankhel fields.
In contrast, gas production declined 2.5% WoW to 2,934 million cubic feet per day (mmcfd), primarily due to lower output from Mari, Uch, Kandhkot and Shewa.
Oil and gas reserves strengthen
Pakistan’s total oil and gas reserves reached 3,720 million barrels of oil equivalent (BOE) in June 2026.
Oil reserves increased 15% YoY to 276 million barrels, while gas reserves rose 9% to 20,664 billion cubic feet (Bcf).
Newly discovered fields contributed an estimated 53.5 million barrels of oil and 773 Bcf of gas, while the country’s estimated reserve life stood at around 19 years.
Foreign exchange reserves rise marginally
Pakistan’s total liquid foreign exchange reserves increased 0.07% WoW to $26.8 billion.
Reserves held by the State Bank of Pakistan (SBP) rose 0.05% WoW to $21.4 billion, while commercial banks’ reserves increased 0.15% to $5.41 billion.
The country’s import cover remained unchanged at approximately 3.03 months.
Refineries sign upgrade agreements
Attock Refinery Limited (ATRL), Pakistan Refinery Limited (PRL), National Refinery Limited (NRL) and Cnergyico have signed upgrade agreements with Inter State Gas Systems (Pvt.) Limited (ISGS).
The agreements were signed under the Pakistan Oil Refining Policy for Upgradation of Existing/Brownfield Refineries, 2023, as amended in February 2024 and August 2026.
Fuel prices and rupee movement
Petroleum prices recorded mixed movements under the government’s daily pricing mechanism.
The price of high-speed diesel (HSD) declined Rs11.92 per litre WoW to Rs412.12, while motor spirit (MS) increased Rs0.14 per litre to Rs389.28.
Meanwhile, the Pakistani rupee posted a marginal 0.03% appreciation, closing at Rs277.16 per US dollar, compared with Rs277.25 previously.
Outlook
According to Arif Habib Limited, the direction of the stock market is expected to remain sensitive to developments in US-Iran talks and international oil prices.
Progress on the ongoing International Monetary Fund (IMF) review is also expected to influence investor sentiment.
The research house noted that the KSE-100 Index is currently trading at a price-to-earnings (P/E) ratio of 7.6, while offering a dividend yield of 6.6%.