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Pakistan raises prices for gasoline and diesel fuel; government announces tariff changes
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Aaj Tak
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Pakistan raises prices for gasoline and diesel fuel; government announces tariff changes

Prices for gasoline and diesel fuel have risen again in Pakistan. The government, led by Shahbaz Sharif, increased the cost of gasoline by 1.08 Pakistani rupees per liter and also raised the price of high-speed diesel (HSD) by 0.51 rupees per liter. These new rates came into effect on Wednesday, September 2.

Following the recent fuel price hike, the retail price of one liter of gasoline reached 343.87 Pakistani rupees, while the price of high-speed diesel rose to 370.92 Pakistani rupees. According to a report by the Pakistani media Dawn, the government of Shahbaz Sharif will continue to levy taxes of 114 rupees per liter of gasoline and 100 rupees per liter of diesel fuel.

Despite the recent fuel price increase in Pakistan, current prices are still significantly lower than the levels recorded in April. During the escalation of the conflict in the Middle East, prices for gasoline and diesel fuel in Pakistan soared. After the US and Israeli attacks on Iran on February 28, the price of high-speed diesel in Pakistan was 281 rupees per liter, but it peaked at 520.35 rupees per liter by April 3.

A similar sharp jump occurred with gasoline prices during the initial phase of the conflict between the US and Iran. In early March, the price of gasoline in Pakistan was 266 rupees per liter, but as fighting escalated in the Middle East, the price reached a maximum of 458.41 rupees by April 3.

When the conflict between the US and Iran concluded, fuel prices in the country were reduced. However, on July 17, Energy Minister Ali Parvez Malik warned in advance about a possible price increase. He stated that due to fluctuations in global oil prices following the resumption of the war between Iran and the US, fuel prices would be set daily instead of every two weeks, as was previously the case.

According to Dawn, the Energy Minister reported that the Council of Ministers and Prime Minister Shahbaz Sharif instructed the Energy and Gas Regulatory Authority to determine fuel prices on a daily basis, based on global market trends.

It should be noted that gasoline is primarily used in private, small, taxi, and two-wheeled vehicles, so any changes in its price affect the middle and lower-middle class. At the same time, changes in diesel fuel prices directly impact ordinary citizens, as diesel is mainly used in heavy transport, power plants, and large generators.

Gasoline and high-speed diesel are the main sources of revenue, with monthly sales volumes amounting to about 700,000 – 800,000 tons, whereas the monthly demand for kerosene is only 10,000 tons.

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Conflict between Iran and the US led to rising gasoline prices in 145 countries, affecting India's economy
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Conflict between Iran and the US led to rising gasoline prices in 145 countries, affecting India's economy

The consequences of military actions are not limited to battlefields; they also affect the daily lives of ordinary people. Tensions between Iran, Israel, and the US have impacted the global oil market. As a result, gasoline prices have sharply risen in many countries, which has affected household expenses.

According to the international website GlobalPetrolPrices, which tracks retail prices for gasoline, diesel fuel, electricity, and natural gas worldwide, after the conflict began in February, gasoline prices increased in 145 out of 170 countries.

Between late February and August, there was an increase in gasoline prices in most countries around the world. Specifically, prices rose by 56% in Myanmar, 55% in Bhutan, and 51% in Cuba. Prices also increased by 50% in the UAE and 48% in Nigeria.

Even in the world's largest economy, the US, the impact of this rise is felt. The average price of gasoline in America rose by 39%, reaching $4.09 per gallon from $2.94. Previously, $50 could cover about 718 kilometers, but now the same amount only allows for 536 kilometers, meaning a reduction in distance by 182 kilometers at the same cost.

India has also not been spared the consequences. The rise in tensions in the Middle East and the increase in crude oil prices have affected the domestic market. In Delhi, prices for gasoline and diesel fuel rose by approximately seven and a half rupees per liter compared to February. However, unlike many other countries where gasoline prices rose by 40–50%, the increase in India was more modest—only 8%.

How the price increase affects all sectors

The increase in oil prices does not only affect car travel. Agriculture, factories, and transport—almost all sectors depend on fuel. Therefore, when crude oil becomes expensive, the costs of producing goods and delivering them to the market also rise. Experts note that the true strength of the global economy lies in transport and supply chains; when energy becomes expensive, it affects all economic activity.

Oil serves as a basis not only for fuel but also for numerous products. It is used in the production of food packaging, plastic bottles, and medical syringes. Furthermore, oil is a key raw material for synthetic fabrics such as polyester and nylon. Petroleum products are also used in making lipsticks, petroleum jelly, and various cosmetic products, as well as in the production of cleaning agents, paints, and other household goods.

India imports about 85% of its crude oil needs from abroad. Consequently, the prolonged rise in international oil prices is not limited only to gasoline and diesel fuel. It can affect transport, fertilizers, packaging, everyday goods, and ultimately, inflation. Thus, the longer the conflict in the Middle East lasts, the greater the economic losses will be for a major oil-importing country like India.

What is GlobalPetrolPrices

GlobalPetrolPrices is a website that tracks retail prices for gasoline, diesel fuel, electricity, and natural gas worldwide. It provides weekly updates on fuel prices in over 150 countries. This data is manually collected from multiple sources and verified. The data from this resource is often used by the media and international organizations.

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