The men - who were wearing masks from the horror film Scream - walked into the Bay Horse pub at around 8.45pm on Tuesday.
They threatened people in the pub before pouring the liquid around the bar and setting it on fire.
Detectives, and fire service investigators remained at the scene this afternoon (Wednesday) carrying out forensic enquiries.
Det Insp Tim Hunt, of Wakefield District CID, said: “A number of proactive enquiries are ongoing into this arson attack which has caused significant damage to this public house.
“Clearly this would have been a very frightening incident for the four people inside the pub who were out before the fire started.
“I would again wish to reiterate that this is an extremely rare incident, especially for the Knottingley area and, we are doing all we can to locate those responsible.
“We have been told several people may have filmed the fire and I would urge anyone who has footage of this incident to come forwards and provide this to police as it could well assist with the investigation.”
One of the men was described as being 5ft 8ins tall, of medium build and wearing a black jacket or hooded top with black tracksuit bottoms.
The other suspect is described as being around 5ft 10ins tall.
People living near the Bay Horse pub said they can’t believe that the blaze did not kill someone.
Kevin Butler and his wife Jan were watching TV in their bungalow on Forge Hill Lane, across the road from the pub, when Mrs Butler saw the flames billowing from the building.
Mr Butler, 70, said: “I was sitting in the lounge and my wife came through and said the Bay Horse was on fire.
“I went through to the back and thick black smoke was billowing from the pub.
“The smoke was getting worse and then we could start to see the flames billowing really high into the air.”
Mr Butler said he used to go in the pub and knew it well.
He said: “I just can’t believe that nobody was hurt.
“It’s a miracle. If there had been anyone staying in the rooms upstairs at the time they would have had no chance of getting out because there is no fire escape - they would have had to go downstairs and through the fire to get out.”
Spanish worker Antonio Romaguera was staying in rooms at the pub while he works at Drax Power Station.
Mr Romaguera, 39, said: “I was working the night-shift as a welder a Drax so, thankfully, I wasn’t here at the time.
“When I finished my shift I came back I saw the state of the pub and the policemen outside who told me what had happened.
“I couldn’t believe it.
“All of my belongings, including my computer and passports are in the pub and I don’t know whether they’ve been ruined.”
Anyone with any information should contact Wakefield CID on 101 or call Crimestoppers, anonymously on 0800 555111.