A novel sensor-based approach for leak detection of oil pipeline is proposed. The approach uses piezoelectric sensor in dynamic pressure transducer. The key to the detection algorithm is the use of the characteristic of piezoelectric sensor: when there are no changes in the pressure, the signal output is zero. Assume the dynamic pressure wave applied to the sensor is symmetry, then the total energy in a period of time is approximately zero, so that, after leak occurred, the total energy in a period of time will greatly deviate from zero. Using a dimensionless variable called sequential energy percentage, the leakage signal becomes distinct and can be easily extracted. Test results are reported to demonstrate the effectiveness of the proposed approach