Govt links fuel price adjustments to global oil surge

March 07, 2026 (MLN): Pakistan’s government has explained recent fuel price adjustments, linking them to a sharp surge in international oil benchmarks and the need to ensure stable energy supplies while protecting the country’s economic stability.

In a statement posted on his X account, Petroleum Minister Ali Pervaiz Malik said the diesel prices declared on March 1, 2026 were based on the Platts fortnightly average of $88 per barrel, but by March 6 the benchmark had jumped to over $149 per barrel.

Petrol prices announced on the same date were based on a Platts average of $78 per barrel, which has since risen to above $106 per barrel, highlighting the rapid volatility in global markets.

Ali Pervaiz Malik noted that crude shipments from Yanbu typically take around 20 days to reach Pakistan, meaning refineries must purchase crude well before it arrives in the country.

He said refiners need confidence that the higher cost of crude they buy today will not later turn into another form of circular debt.

Ali Pervaiz Malik said energy conservation remains a key driver of government policy during the current period of uncertainty and that timely transmission of international prices into domestic markets is essential to discourage hoarding and excessive buying.

He added that inventory gains and losses are a normal part of the oil business and argued that the government should allow markets to function with limited regulatory intervention.

Prompt “mark-to-market” valuation of mandatory stocks, he said, helps prevent stockpiling during volatile periods.

It was also cautioned that geopolitical tensions, particularly the conflict involving Iran, could pose risks to Pakistan’s external account.

He warned against policies that could destabilize markets or risk pushing the country toward the kind of economic crisis it faced in 2022.

Reaffirming the government’s approach, Ali Pervaiz Malik said the administration of Prime Minister Shehbaz Sharif remains committed to maintaining macroeconomic stability and ensuring uninterrupted fuel supplies.

He acknowledged the burden of rising prices on the public and said any relief from falling international prices would be passed on to consumers.

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