Orange City Council chief executive officer David Waddell, alongside mayor Reg Kidd, announced on Friday Orange was facing Level 6 - which is no external watering at homes - restrictions by May 1.

He said with reduced consumption and some inflows that Level 6 start date could be pushed out, but flagging one of the tightest restrictions in the state nearly five months in advance was about giving residents and businesses time to prepare.

The city's reservoirs are currently sitting at 23 per cent.

Level 6 will come into effect when those levels dip to 15 per cent.

"If no significant inflows occur in our storages over the next months, Orange faces the real prospect that our storages could be close to empty in December this year," Mr Waddell said.

"As a result, if the weather continues to provide no relief, as the months pass we face being forced to bring in Level 6 restrictions to the City which could mean significant impacts to our economy.

"Orange has built up a wonderful reputation for the work of its citizens in saving water but this situation is beyond those efforts.

"Orange will lead the pack in the introduction of prudent albeit severe restrictions if the necessity arises. Council's executive will review the situation weekly and, believe me, restrictions will be lifted as soon as humanly possible.

"Today is about transparency and giving businesses and the community a chance to plan."

The Level 5A water restrictions Orange has in the past used were found to not effectively extend the life of the supply or delay level 6, council says.

Mr Waddell said a set of Level 6 restrictions were developed some time ago and they are being reviewed and remodelled to ensure the best possible outcome for the city.

He said the impending introduction of Level 6 restrictions could significantly impact the operations of water-intensive industries, so council was working to drive down consumption of the top 50 non residential users of water in the city to help delay further tightening of water restrictions.

"We may still get to that but right now ... every day of water we save now pushes the introduction of Level 6 further away," Mr Waddell said.

"These are people livelihoods we are talking about here so we won't go into details of the businesses in question only to note that we will be working closely with them."

Orange mayor Reg Kidd said there was a pathway through this adversity.

"This will be no easy task but I am confident that like the residents of the city the commercial sector can and must play a significant role in getting us through this drought," Cr Kidd said.

Cr Kidd said the Council would continue to work with the NSW Government to increase our supply options when rain comes.