Pakistan has announced a sharp increase in petrol and diesel prices for the second time in less than a month, amid the ongoing Middle East war that has deeply impacted the global oil crisis.The latest hike is expected to worsen inflationary pressures and add to the economic burden on citizens already struggling with rising costs.The revised fuel prices were announced by petroleum minister Ali Pervaiz Malik during a press conference broadcast on state television, alongside finance minister Muhammad Aurangzeb.
Diesel prices have been raised by 54.9 per cent to 520.35 rupees per litre, while petrol prices have increased by 42.7 per cent to 458.40 rupees per litre, according to Reuters. The government has also increased kerosene prices by Rs34.08 per litre, taking it to Rs457.80 per litre. The new rates have come into effect immediately, making fuel significantly more expensive across the country.‘Inevitable decision’ amid global turmoilDefending the price hike, Malik said that the government had little choice but to pass on the burden of rising global oil prices to consumers. He stated that international markets had become highly volatile following the US-Iran war, which has disrupted supply chains and pushed crude prices sharply higher.Calling the decision ‘inevitable’, he said, “It was inevitable to raise the prices due to the international market prices going out of control after the US-Iran war.”
Why are fuel prices rising in Pakistan?
The sharp increase in fuel prices is closely linked to geopolitical tensions in the Middle East and Pakistan’s heavy reliance on imported oil. The ongoing conflict has disrupted supply routes, particularly through the Strait of Hormuz, a critical passage for global oil shipments. Pakistan depends largely on imports from countries such as Saudi Arabia and the United Arab Emirates, making it highly vulnerable to fluctuations in international prices. At the same time, global benchmarks have risen sharply, with oil markets witnessing significant volatility, leaving import-dependent economies like Pakistan with limited options.The government indicated that it can no longer sustain large-scale fuel subsidies due to mounting fiscal pressure. Malik said that around Rs129 billion had already been spent over the past few weeks to shield consumers from rising prices, according to Dawn. With limited resources and no immediate end to the conflict in sight, the government has decided to move away from blanket subsidies and instead focus on targeted assistance for the most vulnerable sections of society.“Since the resources are limited and there is no end to this war in sight, there was no way to continue with a blanket subsidy,” he said.
Relief measures for vulnerable groups
Finance minister Muhammad Aurangzeb announced a set of targeted relief measures aimed at cushioning the impact on specific groups. These include subsidies for motorcyclists, support for small farmers and financial assistance for the transport sector to help stabilise fares and ensure the continued movement of goods and passengers. The government also plans to extend support to low-income travellers using rail services.
