Question!

Can you say ' "you ought to use a pencil?"

I heard this word 'ought' for the first time. Can I say "You should use a pencil" instead?

What is the difference?

No difference at all.  It is like, "nana" and "shichi" for the numeral seven.  Japanese is notorious for using different sounding words to mean the same ie "kun" and "on" readings.

You can say both, but saying someone should do something is slightly more formal than saying someone ought to!