Rs55/litre surge in petrol, diesel expected to push transport, food and production costs higher
Petrol rush. Photo: file
LAHORE:
The latest increase in petroleum prices has once again placed Pakistani household budgets under pressure, highlighting the fragile nature of economic stability in a country that relies heavily on imported fuel and gas.
Petrol is now priced at Rs321.17/litre and high-speed diesel at Rs335.86litre. The adjustment follows a sharp rise in international oil prices triggered by the United States and Israel’s illegitimate attack on Iran. For many Pakistanis, the development has revived a familiar sense of uncertainty. Just when inflation had begun showing signs of easing after months of tight monetary policies and government efforts to stabilise prices, the external shock has again raised fears about rising transportation costs, higher food prices and increasing electricity bills.
“We now largely feel that we might not be able to come out of this vicious circle,” said Muhammad Irfan, owner of a small grocery shop. He said fuel prices had remained relatively stable even though they were near historic highs, but the stability helped shopkeepers manage prices of other essential commodities. “The latest increase in fuel prices will ripple through the entire supply chain as whenever petrol goes up, everything else follows. The wholesalers increase their rates, transporters charge more, and then customers argue with us for higher prices. It becomes difficult for everyone,” he added.
Many middle-income Pakistanis believe the timing of the hike is particularly difficult as the country is currently observing the holy month of Ramazan. The festive season will soon follow with Eid for Muslims and Easter for the Christian community. “People were hoping this Eid would be a little easier after a tough year. Now I fear prices of flour, vegetables and meat will rise again,” said Bilal Ahmed, a ride-hailing driver. “Even buying clothes for children becomes a calculation.”
He said the fuel price adjustment directly affects his daily earnings. “I work nearly twelve hours a day, but every time petrol becomes expensive my income shrinks,” he said. “Customers are reluctant to pay higher fares while ride-hailing companies hesitate to increase fares for fear of losing customers. “But we cannot run our cars without fuel,” he said.
Blue-collar workers are feeling the pressure even more intensely. Sajid Mehmood, a construction labourer who commutes daily from the outskirts of the city, said higher diesel prices will quickly raise transport fares. “My wage has not increased in months, but the bus fare keeps rising,” he said. “By the end of the month there is almost nothing left.”
“The worst part is that we do not know if the fares will come down even if the fuel price hike reverses,” he said.
Economists say such developments highlight Pakistan’s vulnerability to global shocks. The Russia-Ukraine conflict triggered sharp increases in global commodity prices, while climate disasters such as floods placed additional strain on public finances and food supply chains. Political uncertainty and negotiations with international lenders have also complicated the country’s stabilisation efforts.
For many middle-class families, the problem is not only rising prices but also the unpredictability of financial planning. “Every time things start improving, some new crisis appears somewhere in the world,” said Sadia Sheikh, a schoolteacher and mother of two.
“You try to save money, plan your children’s education, maybe think about buying a small car, but then inflation returns and the plan collapses,” she said. “We know Pakistan imports oil and global prices affect us, but people also expect the government to prepare for these situations and strengthen internal systems,” she said.
The business community is also watching developments closely. Lahore Chamber of Commerce and Industry President Faheemur Rehman Saigol said, “Pakistan relies heavily on road-based freight and higher fuel prices will quickly move through supply chains, pushing up prices of food, construction materials and consumer goods. Exporters, already struggling with high energy tariffs and financing costs, may face additional pressure on competitiveness in international markets.
Small and medium-sized businesses are already feeling the pressure. Adnan Ali, who runs a garments workshop employing 12 workers, said rising fuel prices indirectly increase operational costs across the board. “Transporting raw material becomes expensive. The government already increased petrol prices by Rs8/litre and diesel by Rs5/litre on March 1. Electricity bills will eventually follow and we may have to increase the price of finished products,” he said.
