Historic hike: Petrol, diesel prices soar amid global crisis

Islamabad-(Mudassar Iqbal/News Desk)-Federal Minister for Petroleum Ali Pervaiz Malik on Thursday announced a significant increase in fuel prices, attributing the move to the ongoing Middle East conflict and escalating global energy costs.

Speaking at a press conference alongside Finance Minister Muhammad Aurangzeb, he stated that petrol prices have been raised to Rs458.40 per litre, while high-speed diesel will now be sold at Rs520.35 per litre.

He further explained that petrol has been increased by Rs137.23 per litre, whereas diesel has seen a sharp rise of Rs184.49 per litre, reflecting the pressure of rising international oil prices.

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Global energy and oil markets were upended after the United States and Israel launched joint strikes on Iran on February 28. Tehran, in response, effectively blocked the Strait of Hormuz, a key shipping route, and hit oil refineries across the Gulf region.

The turmoil in the Gulf region has led to a spike in global oil and energy prices, with countries around the world rushing to ration fuel and energy.

Pakistan also rolled out a wide-ranging austerity and fuel conservation plan and initially announced a sharp increase of Rs55 per litre in the price of petrol and diesel on March 6.

The PML-N-led federal government, however, kept the prices of petroleum products steady in the previous three weekly reviews.

Addressing the presser earlier today, Malik said the situation in the region has made the global economy difficult. He noted the government’s efforts to shield the public, saying, “We have made every effort to ensure that the burden does not fall on the people through austerity and spending cuts.”

Referring to the global oil market, the minister said: “For several weeks, the situation has been worsening. Crude oil prices have reached record levels, with diesel in the international market rising above $250 per barrel.”

Highlighting supply challenges, Malik explained: “Oil supply primarily comes through the Strait of Hormuz. Even countries with strategic reserves have declared energy emergencies.”

Praising the timely decisions of the government, the petroleum minister said: “During this difficult time, the prime minister formed a committee that took prompt decisions. These timely decisions ensured that fuel supply was not disrupted.”

On subsidy adjustments, the minister said that a major meeting was held with Prime Minister Shehbaz Sharif and chief ministers, and it was decided that blanket subsidies may no longer protect the public from global price increases. Instead, assistance will focus on vulnerable groups.

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For his part, Finance Minister Muhammad Aurangzeb said that the key decision about a hike in fuel prices was made after consultation with the country’s leadership.

Addressing the joint presser, the finance czar announced a shift from blanket subsidies to targeted support to ensure relief reaches those most in need.

He said that motorcyclists would receive a subsidy of Rs100 per litre on up to 20 litres of petrol per month.

Separately, a subsidy of Rs100 per litre on diesel will be given to intercity public transport, he added.

The finance minister further said that a subsidy of Rs70,000 per month on fuel will be given to trucks and goods transport. The government will also provide a subsidy for railways so that fares can be managed, the minister said.

The finance czar said the govt would review market timings nationwide to conserve fuel and reduce electricity generation costs.

He added that a final decision about the market timings would be made after consultations with provincial governments.