Pakistan sharply increased consumer prices of diesel and gasoline on Thursday, marking its second increase in less than a month, against a backdrop of a surge in global crude prices fueled by tensions in the Middle East.
The price of diesel jumped 54.9% to 520.35 rupees ($1.88) per liter, while that of gasoline rose 42.7% to 458.40 rupees per liter.
“It was inevitable to raise prices due to the boom in the international market following the conflict between the United States and Iran,” declared Pakistani Oil Minister Ali Pervaiz Malik during a press conference broadcast on television of State alongside the Minister of Finance.
Last month, the South Asian nation had already raised consumer prices of diesel and gasoline by around 20%, citing rising oil prices induced by hostilities between the United States, Israel and Iran.
This decision is expected to have repercussions on inflation and hit the country’s disadvantaged population hard. Pakistan imports most of its oil from Saudi Arabia and the United Arab Emirates via the Strait of Hormuz.
Finance Minister Muhammad Aurangzeb separately announced subsidies at the press conference to provide relief to small farmers, motorcyclists and intercity freight and passenger transport.
Mr. Malik said that the government had granted 129 billion rupees in subsidies over the last three weeks, but that this effort was no longer sustainable in the face of soaring international prices.
“As resources were limited and the outcome of this conflict remained uncertain, it was no longer possible to maintain a generalized subsidy,” he added.
American oil prices jumped more than 11% on Thursday, while Brent soared more than 7% during a volatile session, the day after declarations by American President Donald Trump announcing an intensification of military operations.
($1 = 278.7000 Pakistani Rupees)
