Record fuel price hike hits Pakistan amid regional conflict

Petrol and diesel prices raised by Rs55 per litre
Petrol levy increased while diesel levy reduced by Rs20 each
Record hike announced hours after govt assured adequate fuel reserves
Global crude prices nearing $100 per barrel
Proposed fuel-saving measures, including work-from-home and online classes, postponed
PM orders provinces to act against petroleum hoarding
ISLAMABAD: Pakistan experienced a major economic impact of the ongoing US-Israel conflict with Iran on Friday, as the government announced a record increase of Rs55 per litre in the prices of petrol and high-speed diesel.
The announcement came only hours after Prime Minister Shehbaz Sharif and Finance Minister Muhammad Aurangzeb assured the public that the country had sufficient petroleum reserves and that the situation remained under control.
Earlier in the day, the government also decided to postpone a proposed national fuel conservation plan that included measures such as work-from-home arrangements and distance learning. Authorities instead chose to maintain normal activities for at least the next week.
The unprecedented price hike was announced by Petroleum Minister Ali Pervaiz Malik during a press conference attended by Deputy Prime Minister and Foreign Minister Ishaq Dar and Finance Minister Aurangzeb. The revised prices took effect from Saturday.
Following the announcement, long queues formed at petrol pumps across several cities as motorists rushed to refuel before the new rates came into force. Reports also suggested that some fuel stations temporarily shut down their pumps, apparently to avoid selling fuel at the older prices.
Under the revised pricing structure, the government increased the petroleum development levy (PDL) on petrol by Rs20, raising it to around Rs105 per litre. At the same time, the levy on high-speed diesel was reduced from Rs77 to Rs57 per litre to limit the rise in diesel prices.
As a result, the ex-depot price of high-speed diesel has been set at Rs335.86 per litre for the coming week, up nearly 20 per cent from Rs280.86. Petrol prices have been raised to Rs321.17 per litre from Rs266.17, reflecting an increase of about 17 per cent.
Speaking at the press conference, Mr Malik said the conflict that began in a neighbouring country had now spread across the region, creating significant uncertainty in global energy markets.
“The fire that began in a neighbouring country has spread throughout the region. We do not know how long this crisis will continue or when it will end,” he said.
The petroleum minister also warned that strict action would be taken against anyone involved in hoarding or creating artificial shortages of petroleum products.
He noted that Pakistan depends heavily on oil shipments passing through the Strait of Hormuz, which has been affected by the ongoing conflict. However, he said two vessels of the Pakistan National Shipping Corporation were currently transporting fuel through alternative routes via Yanbu and Fujairah to maintain supplies.
Global oil prices have risen sharply in recent days. According to Reuters, US crude oil futures surged more than 12 per cent on Friday to above $90 per barrel, while Brent crude climbed about 8 per cent to $92 per barrel, approaching the key $100 mark.
Mr Malik said the government would now review petroleum prices on a weekly basis due to volatility in international markets. “If the situation improves globally, we will reduce prices just as quickly,” he added.
Earlier, Ishaq Dar said international oil prices had increased by 50 to 70 per cent because of the crisis. “In many countries, prices adjust automatically, but we tried to pass on the minimum possible burden to consumers while maintaining balance,” he said.
Finance Minister Aurangzeb reiterated that Pakistan currently has adequate petroleum reserves and that the country’s economic situation remains stable. He added that the government would closely monitor the impact of rising fuel prices on trade and economic activity.
Fuel conservation plan delayed
The decision to delay the proposed fuel conservation plan was taken during a high-level meeting chaired by Prime Minister Shehbaz Sharif to review petroleum reserves.
According to sources, the meeting decided to defer measures such as work-from-home and online education for at least a week because current fuel stocks were considered sufficient to meet national demand.
Earlier, the government had planned to introduce weekly fuel price revisions from March 8 and implement conservation measures due to fears of supply disruptions linked to the Middle East crisis.
The contingency plan, prepared in consultation with provincial governments by a cabinet committee monitoring petrol prices, was presented to the prime minister but was not forwarded to the Economic Coordination Committee for formal approval. Sources said the proposals had also been discussed with the International Monetary Fund.
According to a statement issued by the Prime Minister’s Office, the Ministry of Petroleum briefed the meeting on fuel reserves and regional developments, confirming that supplies were currently adequate.
The prime minister directed provincial governments to take strict action against hoarding. Petrol pumps found creating artificial shortages would be sealed immediately, their licences cancelled and legal action initiated.
He also instructed authorities to develop a digital dashboard to track the movement of petroleum products and share real-time data with provinces to ensure effective monitoring of fuel supplies.
Punjab orders action against hoarding
Meanwhile, the Punjab government directed deputy commissioners across the province to launch an immediate crackdown on the hoarding of petroleum products.
The instructions were issued during a meeting chaired by Chief Secretary Zahid Akhtar Zaman at the Civil Secretariat, where officials reviewed the availability and pricing of essential commodities.
District administrations were told to take strict legal action against individuals involved in illegal hoarding. The chief secretary stressed that such practices would not be tolerated and ordered authorities to strictly enforce relevant laws.

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