Pakistan government considers freezing petroleum product prices despite global increases
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View on mapPM Shehbaz bans use of high-octane fuel in govt vehicles
ISLAMABAD: In another step towards tightening austerity measures, Prime Minister Shehbaz Sharif on Monday imposed a complete ban on the use of high-octane fuel in government vehicles, shortly after the announcement of a Rs200 increase in the levy on high-octane fuel. The decision comes amid government efforts to manage the economic impact of rising global oil prices following the US-Israel war on Iran, which has triggered a fuel crisis. According to an announcement by the Prime Minister’s Office (PMO), the premier directed relevant authorities to take action against government officials who used high-octane in their official vehicles. “If necessary, the officials will have to bear the cost of high-octane fuel from their own pocket,” the announcement quoted PM Shehbaz as saying. He stressed the need for maximum conservation of fuel in view of global oil crisis due to the US-Israel war on Iran, and Iran’s subsequent attacks on United States air bases and other facilities in Gulf States, including their oil refineries. On Sunday, PM Shehbaz had issued a directive to increase the levy on high-octane fuel used by luxury vehicles by an additional Rs200 per litre, bringing the total levy to Rs300 per litre. “The prime minister took notice that the levy on high-octane fuel used in the most expensive vehicles should be increased,” the statement had said. The prices of fuel used in ordinary vehicles used by the lower and middle classes has not been increased, preventing an increase in the price of public transport or airfare. It is expected that the decision will save the government Rs9 billion per month and as per the prime minister’s instructions, this will be used to provide relief to citizens. The decision may reduce the burden on the economy, as the richest class in the country will bear the burden, the statement noted. The PM’s latest directive is in line with austerity measures announced by the government two weeks ago to cope with the fuel crisis triggered by the Iran war The measures so far have included a hike in petroleum products’ prices, a 50 per cent cut in fuel allowance for official vehicles and a four-day work week. It was also decided that 50pc of staff in the public sector would work from home; however, those providing essential services are exempt. Last Thursday, the government had appealed to the public to adopt fuel conservation measures to “avert the risk of petroleum products’ supply getting affected in the coming days”. A day later, the premier said that he had rejected recommendations for further increasing the prices of petroleum products. However, he said he had instructed relevant ministries to devise a mechanism to ensure that the “relief” was restricted to only the deserving and needy.
DawnMarch 23, 2026 at 07:28 AM UTCLevy on high-octane fuel raised by Rs200 per litre
• Govt expects to save Rs9bn per month; savings to be used for public relief • Move aims to shift burden to higher-income groups • Aurangzeb says focus is on ‘targeted relief’ • Measure won’t affect public transport, airfares ISLAMABAD: Prime Minister Shehbaz Sharif on Sunday announced an increase in the levy on high-octane fuel, a premium-grade petroleum product with a higher octane rating, used mainly in luxury and high-performance vehicles, by Rs200 per litre. According to a statement issued by the Prime Minister’s Office (PMO), the decision was taken during a virtual meeting chaired by the premier to review the pricing of high-octane fuel used in “luxury vehicles”. “The prime minister took notice that the levy on high-octane fuel used in the most expensive vehicles should be increased,” the statement said. The levy, previously set at Rs100 per litre, has now been raised by Rs200, taking the total levy to Rs300 per litre. “This decision will save the government Rs9 billion per month and as per the prime minister’s instructions, will be used to provide relief to the public,” the PMO said. It added that the move was aimed at reducing the economic burden by shifting it to higher-income groups. “The richest class in the country will bear the burden,” the statement said. The PMO emphasised that fuel prices for ordinary vehicles used by lower- and middle-income groups had not been increased, and the move would not impact public transport fares or air travel costs. The statement added that the premier had directed the relevant ministry to prepare an action plan after taking notice of high-octane fuel pricing. The decision comes amid government efforts to manage the economic impact of rising global oil prices following the US-Israel war on Iran, which has triggered a fuel crisis. Two weeks ago, the government announced austerity measures, including a 50 per cent cut in fuel allowances for official vehicles and the introduction of a four-day work week for government offices. It was also decided that 50pc of public sector employees would work from home, except those providing essential services. On Thursday, the government had appealed to the public to adopt fuel-conservation measures to “avert the risk of petroleum products’ supply getting affected in the coming days”. A day later, PM Shehbaz said that he had rejected recommendations for further increasing the prices of petroleum products.However, he said he had instructed relevant ministries to devise a mechanism to ensure that the “relief” was restricted to only the deserving and needy. ‘Targeted relief’ In a televised address on Sunday, Finance Minister Muhammad Aurangzeb said the government was now moving toward such “targeted relief” so that benefits are passed on to the deserving. Referring to the prime minister’s address, Mr Aurangzeb noted that the government had already absorbed a significant financial impact. “He spoke clearly and said that the government has taken on Rs69bn of the burden using our own fiscal resources,” the finance minister said. Mr Aurangzeb said daily meetings were being convened to manage the crisis, covering procurement, logistics and diplomatic efforts to ensure stable supplies. The country was “in a good place until April in terms of the supply situation,” he said. He warned, however, that hope was not a sufficient plan for a crisis that could last for weeks or months. “Hope is not a strategy,” Mr Aurangzeb said. “This is why we need to pursue a structural solution and take firm, lasting steps to move this situation toward permanence, given our resources.” The minister expressed gratitude for public suggestions on fuel rationing and price transmission, pledging that the government would consider them. “As we say, never let a good crisis go to waste,” Aurangzeb said. He also called on the country’s private sector to contribute to the conservation efforts. “I again request my friends, brothers and sisters in private sector leadership, please step up,” he said. “We have to come together and lift this country out of this crisis.” ‘Scarcity of energy’ Finance minister comments followed a press briefing on Saturday, where Petroleum Minister Ali Pervaiz Malik and Information Minister Attaullah Tarar outlined the government’s strategy. Mr Malik said the prime minister has asked the nation to display a responsible attitude in light of the energy crisis. “There is a scarcity of energy. If we avoid travelling, try to opt work from home, continue the usual work in universities with e-learning and avoid the unnecessary entertainment it is equal to saving a dollar that we have earned or managed it from somewhere to arrange for the fuel,” Mr Malik said. He said the time had come to decide whether the government protects those with massive resources or those who earn a livelihood with hard work, such as “bike riders and those driving rickshaws.” Mr Malik said that despite the closure of the Strait of Hormuz, Deputy Prime Minister and Foreign Minister Ishaq Dar had arranged for an uninterrupted supply of crude oil from Saudi Arabia and the United Arab Emirates. Addressing the same briefing, the information minister praised the “timely decisions” by the prime minister to replenish oil reserves and said the austerity measures taken by the government had already ensured savings of Rs27 billion in a special fund. Mr Tarar warned that the absence of a shortage did not mean resources should be misused and urged the public to adopt fuel conservation measures like carpooling. “Those who own more than one car should prefer vehicles with lower fuel consumption to reduce fuel usage,” he said. Published in Dawn, March 23rd, 2026
DawnMarch 23, 2026 at 02:33 AM UTCGovt increases levy on high-octane fuel used in luxury vehicles by Rs200 per litre
Prime Minister Shehbaz Sharif on Sunday directed to increase the levy on high-octane fuel used by luxury vehicles by Rs200 per litre. According to a handout from the Prime Minister’s Office (PMO), the development came as the premier virtually chaired a meeting on decisions regarding high-octane fuel used in “luxury vehicles”. “The prime minister took notice that the levy on high-octane fuel used in the most expensive vehicles should be increased,” the statement said. Therefore, PM Shehbaz decided that the levy, which was Rs100 per litre, should be increased by Rs200 per litre. “A levy of Rs300 per litre will now be applicable on high-octane fuel used in the most expensive vehicles,” the statement said. “This decision will save the government Rs 9 billion per month and as per the prime minister’s instructions, this will be used to provide the people with relief,” it said. “This decision will reduce the burden on the economy; the richest class in the country will bear the burden,” it said. “The prices of fuel used in ordinary vehicles used by the lower and middle classes have not been increased, only the price of high-octane fuel used in luxury vehicles has been increased,” the PMO said, adding that this would not cause an increase in the price of public transport or airfare. It said that the premier had taken notice of high-octane prices and directed the ministry concerned to prepare an action plan in this regard. Two weeks ago, the government announced unprecedented austerity measures to cope with the fuel crisis triggered by the US-Israeli war on Iran after hiking petroleum products’ prices earlier this month. The measures included a 50 per cent cut in fuel allowance for official vehicles and a four-day work week. It was also decided that 50pc of staff in the public sector would work from home; however, those providing essential services are exempt. On Thursday, the government had appealed to the public to adopt fuel-conservation measures to “avert the risk of petroleum products’ supply getting affected in the coming days”. A day later, Prime Minister Shehbaz Sharif said that he had rejected recommendations for further increasing the prices of petroleum products. However, he said he had instructed relevant ministries to devise a mechanism to ensure that the “relief” was restricted to only the deserving and needy.
DawnMarch 22, 2026 at 03:54 PM UTCAurangzeb says govt to move towards providing targeted relief amid global fuel supply concerns
Finance Minister Muhammad Aurangzeb on Sunday said that the government was moving towards “targeted relief” so that the benefit is passed onto the deserving. Aurangzeb’s remarks came amid spiking global fuel prices caused by the US-Israeli war on Iran. Delivering a televised address, the minister referred to Prime Minister Shehbaz Sharif’s address to the nation on Friday night, where the latter mentioned the steps taken to minimise the burden on the public “He spoke clearly and said that the government has taken on Rs69bn of the burden using our own fiscal resources,” the finance minister said. “Yesterday, my honourable colleagues in the cabinet, Petroleum Minister Ali Pervaiz Malik and Information Minister Attaullah Tarar, had a detailed talk,” he said. “Ali Pervaiz Malik sahib especially said in detail that all our efforts are focused on making sure we have supplies, so that we have no supply disruption in the chain [and] we can ensure the uninterrupted supply of petrol, diesel and other molecules,” Aurangzeb said. The finance minister added that daily meetings were being convened to look at procurement and its sources of procurement, logistical issues, maritime affairs and diplomatic efforts, noting that on that basis, the government believed the country was “in a good place until April in terms of the supply situation”. “We are hopeful that the war and regional conflicts will end soon, but as I said in my very first conference with [Deputy Prime Minister and Foreign Minister Ishaq] Dar sahib and Ali Pervaiz sahib, hope is not a strategy,” Aurangzeb added. “However, the manner in which matters have escalated, especially with how energy infrastructure has been hit, it is possible that the situation may carry on for weeks or, God forbid, months, until this disruption does not end.” In view of the current situation, the finance minister stressed the need to move towards more sustainable solutions. On the premier’s instructions, the government was working to minimise the burden on the public, Aurangzeb added, noting the reality that Pakistan’s resources were not infinite. “This is why we need to pursue a structural solution and take firm, lasting steps to move this situation toward permanence, given our resources,” he stated. “As a result, we are now in active planning and various steps are being considered. The petroleum and information ministers noted that we will move toward demand management and conservation, as well as targeted relief, so that relief is passed on to deserving people.” Aurangzeb said that the petroleum, IT, and finance ministries, among others, were cooperating to develop more structural solutions. He expressed gratitude to the public for “brilliant recommendations” over the past seven to 10 days on price transmission and the rationing of available fuel. “I must admit, some of these recommendations can really lead us towards sustainable growth once this shortage ends,” Aurangzeb emphasised. “As we say, never let a good crisis go to waste.” Calling some of the suggested measures “very well thought through”, the finance minister pledged that the government would consider them as some of the “important and absolutely critical” would be announced and rolled out. “I just want to say that the conversation is presently focused on supply and pricing, and rightly so. But this does not mean that the wider economic situation is being ignored,” he clarified. Aurganzeb added that ministers of commerce and maritime affairs, as well as the State Bank governor, were also present at daily meetings. “We are looking at the impacts on trade and industry if this situation continues, as well as wider economic impacts, whether it’s our current account, balance of payments, [or] forex reserves,” he explained. “We are planning scenarios for all of these and planning proactively. If you have any further recommendations, send those in, and we will take them into account over the next few weeks and the next few months.” Concluding his address, Aurangzeb stressed the need for the private sector to “lead this country”, noting that austerity measures and conservation efforts adopted by the federal and provincial governments and state-owned enterprises had yet to be applied by private entities. “I again request my friends, brothers and sisters in private sector leadership, please step up,” he said. “We have only spoken in an advisory capacity thus far, but we have to come together and lift this country out of this crisis. “I am very, very confident that if the public sector and private sector come together, we will come out of this crisis stronger as a nation and as an economy.” Two weeks ago, the government announced unprecedented austerity measures to cope with the fuel crisis triggered by the US-Israeli war on Iran after hiking petroleum products’ prices earlier this month. The measures included a 50 per cent cut in fuel allowance for official vehicles and a four-day work week. It was also decided that 50pc of staff in the public sector would work from home; however, those providing essential services are exempt. On Thursday, the government had appealed to the public to adopt fuel-conservation measures to “avert the risk of petroleum products’ supply getting affected in the coming days”. A day later, Prime Minister Shehbaz Sharif said that he had rejected recommendations for further increasing the prices of petroleum products. However, he said he had instructed relevant ministries to devise a mechanism to ensure that the “relief” was restricted to only the deserving and needy.
DawnMarch 22, 2026 at 12:47 PM UTC‘Scarcity of energy’: PM Shehbaz urges nation, govt to display responsible attitude
Petroleum Minister Ali Pervaiz Malik said on Saturday that Prime Minister Shehbaz Sharif has asked the nation and the government to display a responsible attitude in light of the current energy crisis. “There is scarcity of energy. If we avoid travelling, try to opt work from home, continue the usual work in universities with e-learning and avoid the unnecessary entertainment it is equal to saving a dollar that we have earned or managed it from somewhere to arrange for the fuel,” Malik said in a press briefing alongside Information Minister Attaullah Tarar. Malik further said the premier urged the people to play their role with responsibility and assist those in need around them. He vowed on behalf of the prime minister that the government would “leave no stone unturned for gathering further resources in consultation with the provincial governments to deal with the crisis […] by providing protection to the weakest section of the society”. The petroleum minister said the time had arrived to make a decision about whether the “government has to provide protection” to the people with massive respect and resources, or to those who earn their livelihoods with hard work, such as bikeriders and those driving rickshaws. “The time has probably come that the government will review the schemes afresh and divert the limited resources for the protection of the weak strata of the society,“ he added. Terming the hike in global oil prices “unprecedented”, Malik highlighted that Deputy Prime Minister and Foreign Minister Ishaq Dar had arranged for crude oil from Saudi Arabia and the United Arab Emirates in these difficult times through diplomatic channels. “The Strait of Hormuz is closed. However, Saudi Arabia is providing uninterrupted supply of crude oil to Pakistan through Red Sea, while the UAE is also providing oil to us through Fujairah out of the Strait waterways,” he stated. At the outset of his address, the minister remarked that the joy of Eid had been overshadowed because the entire region was mirred in conflicts. Malik lashed out at the former PTI government led by Imran Khan, saying, “The prime minister took entirely different decisions as compared to the measures taken by the then PTI government in 2022 in the similar situation. [At that time] without any preparation the then-government had taken the country on the course of bankruptcy.” “During the last three weeks the price of crude oil has reached the highest in the recent history,” the minister said, adding a two-fold and three-fold increase in the prices of crude oil was observed, while the prices of diesel which is based on platz increased from $80 per barrel to more than $200 per barrel. He described the hike in petroleum prices and passing the burden to the market as a “bold decision” made by PM Shehbaz. “The premier also sent a clear message to the refineries that they should not hesitate from purchasing expensive fuel so that there would be no disruption in the supply and ensured them that the full amount will be recovered by the government. “The prime priority is to ensure the availability of fuel,” Malik said, adding that the austerity measures taken by the government had ensured savings worth Rs27 billion in a special fund. The savings would be used in preventing passing down the oil price hikes to the common people, he added.
DawnMarch 21, 2026 at 03:57 PM UTCPM Shehbaz rejects recommendations for further hike in petrol, diesel prices
Prime Minister Shehbaz Sharif said on Friday that he had rejected recommendations for further increasing petrol and high-speed diesel (HSD) prices, adding that, however, he had instructed relevant ministries to devise a mechanism to ensure that the “relief” was restricted to only the deserving and needy. He said this during an address to the nation, delivered on the eve of Eidul Fitr. The premier began his address by extending Eid greetings to the nation. He also referred to a global fuel crisis resulting from the US-Israeli war on Iran, which began on February 28. The government announced unprecedented austerity measures last week to cope with the crisis and also hiked petroleum products’ prices earlier this month. PM Shehbaz said in view of the present situation, the festival demanded humanity, national unity and collective responsibility. “And I believe the joy of Eid in its true sense is sharing it with those in need,” he added. The premier said the world was facing an “extraordinary challenge” today, adding that the values of selflessness, hard work and compassion were the only means to resolving the crisis. He said the war going on in the Middle East had severely impacted the global peace and economy, as well as the common man. “The situation has become even more dangerous in the aftermath of attacks on energy installations of brotherly countries,” he added. “And the risk of this crisis intensifying and prolonging increases with every passing moment.” PM Shehbaz noted that the price of oil from the Middle East had skyrocketed in the international market. “It was available for $72 per barrel a few weeks ago, but in just three weeks, the price has breached the historic mark of $158 per barrel,” he said. He warned that if the situation continued to worsen, a further increase in fuel prices would be imminent. The premier said the crisis was giving rise to an “inflation storm”, adding that he realised that an increase in petrol and HSD prices earlier in March by Rs55 per litre had badly affected a common man’s life. He lauded the nation for its “patience and courage” during these challenging times, thanking the people for their “cooperation”. PM Shehbaz said on March 13, oil prices in the international market had significantly increased again. Thereafter, he continued, a recommendation for increasing the price of petrol by Rs50 per litre and that of HSD by Rs74 per litre was made. “But I rejected this recommendation,” he said, explaining that he realised the burden that the people were bearing following the Rs55 per litre increase. So, he said, “I decided that the federal government will bear the burden of around Rs24 billion, resulting from the rise in oil prices. For this, we made necessary cuts in our budgets and limited development expenditure”. He further said another increase had been witnessed in oil prices in the “week starting today”, following which it was again recommended to him to increase the price of petrol by Rs76 per litre and that of diesel by Rs177 per litre. But, he said, he rejected the recommendations, particularly considering that Eid was so close. “So, once again, the federal government will bear the additional burden of Rs45bn,” PM Shehbaz said. The premier said that for the last two weeks, the federal government had spent Rs69bn from its “savings and development budgets” to prevent an increase of Rs127 per litre in the price of petrol and Rs252 per litre in that of HSD. However, he added, it was not a lasting solution. He also noted that the measures did not just benefit the deserving and needy, but also those who were well off. “To stop this unjust practice, I have issued instructions to relevant ministries to form a comprehensive and transparent mechanism to ensure that the relief is limited to the deserving,” he announced.
DawnMarch 20, 2026 at 08:21 PM UTCGovt urges conservation amid risks to fuel supply
• PM directs emergency measures, consultation with provinces; informed ample stocks available • People asked to avoid unnecessary travel, adapt in light of regional tensions • More austerity measures said to be on the cards ISLAMABAD: As the Iran war escalates into more attacks on key energy facilities, the federal government on Thursday feared a possible shortage of petroleum products in the coming days amid risks of disruptions in the supply chain, urging the public to adopt fuel-conservation measures to reduce consumption. Prime Minister Shehbaz Sharif chaired a meeting to review fuel-saving efforts and austerity measures amid a worsening situation in the Gulf due to the US-Israel and Iran war, which has disrupted fuel supplies through the Strait of Hormuz. The meeting was briefed about the country’s fuel reserves and consumption and petroleum cargoes, a handout issued by the PM’s Office (PMO) said. According to the statement, the country needed to be prepared for all kinds of situations and people would have to adapt in light of the changing situation. The government also urged people to carpool and avoid unnecessary travel due to the unstable situation in the region. The meeting was informed that there were “adequate stocks of petroleum products” available to meet the country’s requirements and that arrangements to procure more fuel were also being made. However, the regional situation could “severely affect fuel supplies”, so more conservation measures were needed in the upcoming days. The government requested the people to conserve petrol and diesel to “avert the risk of petroleum products’ supply getting affected in the coming days”, and also asked the affluent classes to lead by example. In light of the precarious situation, PM Shehbaz issued directives for a “comprehensive strategy” in consultations with the provinces to deal with any “emergency situation”. The meeting was also informed about the implementation of austerity and fuel conservation measures so far taken by the government. At this, PM Shehbaz said, “We are able to provide relief to the people because of the policy of austerity.” The meeting was apprised that the austerity measures were being ensured and that the Intelligence Bureau (IB) was monitoring the situation. The IB had been tasked with carrying out an audit of austerity measures announced by the government and reporting to the PM on their implementation. It added that the meeting was told that the overall situation was being monitored and a record of petroleum products was being maintained so that any “irregularity” could be promptly identified and countermeasures could be taken. The meeting was also attended by Chief of Defence Forces Field Marshal Asim Munir, National Security Adviser Lt-Gen Asim Malik, and several federal ministers. Last week, the government announced unprecedented austerity measures to cope with the situation that emerged due to the Iran war, which has led to a global oil crisis affecting various countries, including Pakistan. The measures included a 50 per cent cut in fuel allowance for official vehicles and a four-day work week. It was also decided that 50pc of staff in the public sector would work from home; however, those providing essential services were exempt. Published in Dawn, March 20th, 2026
DawnMarch 20, 2026 at 02:37 AM UTCGovt appeals to public to adopt fuel-conservation measures to avert risk of supply disruption
The government appealed to the public on Thursday to adopt fuel-conservation measures to “avert the risk of petroleum products’ supply getting affected in the coming days”. The appeal was made in a handout issued after a meeting chaired by Prime Minister Shehbaz Sharif in Islamabad, where fuel-conservation and austerity measures recently announced by the government were reviewed. Last week, the government announced unprecedented austerity measures to cope with the situation that emerged due to the US-Israel war on Iran, which has led to a global oil crisis affecting various countries, including Pakistan. The measures included a 50 per cent cut in fuel allowance for official vehicles and a four-day work week. It was also decided that 50pc of staff in the public sector would work from home; however, those providing essential services are exempt. The meeting held on Thursday to review the situation was briefed about the country’s fuel reserves and consumption, as well as petroleum products’ cargoes, the handout issued by the PM’s Office (PMO) said. It added that the meeting was informed that there were “adequate stocks of petroleum products” to meet the country’s requirements, and that arrangements for procuring more fuel were also being made. However, it was also stated that “in view of the unstable situation in the Middle East and the region, which could severely affect fuel supplies, further conservation measures will have to be taken in the coming days”. The handout said that PM Shehbaz issued directives for devising a “comprehensive strategy” with the provinces so that any “emergency situation can be dealt with”. Moreover, it added, the meeting was informed about the implementation of austerity and fuel conservation measures, about which PM Shehbaz said: “We are able to provide relief to the people because of the policy of austerity.” The PM, as well as the rest of the meeting’s participants, was told that the implementation of the premier’s instructions regarding austerity measures was being ensured and that the Intelligence Bureau (IB) was monitoring the situation. The IB has been tasked with carrying out an audit of austerity measures announced by the government and to submit a report on their implementation. In the handout, the rich were urged to set an example by adopting austerity measures. It also carried an appeal by the government, which urged people to conserve petrol and diesel to “avert the risk of petroleum products’ supply getting affected in the coming days”. It was stressed during that meeting that the country would have to be prepared for all kinds of situations and that people would have to adapt their practices in light of the changing situation. People were urged to adopt carpooling and avoid travelling unnecessarily. The handout said PM Shehbaz directed all relevant departments to take any emergency steps. It added that the meeting was told that the overall situation was being monitored and a record of petroleum products was being maintained so that any “irregularity” could be promptly identified and countermeasures could be taken. Chief of Defence Forces and Chief of Army Staff Field Marshal Asim Munir, National Security Adviser Lt General Asim Malik and several federal ministers were among those who attended the meeting, the handout said.
DawnMarch 19, 2026 at 03:02 PM UTCStopgap or long-term?
ONE must acknowledge that the government acted promptly in response to the breakout of hostilities on Feb 28 between the US and Israel on the one hand and Iran on the other. Immediately after the beginning of the coordinated bombing on targets in Iran, Tehran almost immediately — in fact on the very next day —responded by launching its missiles and drones in the direction of Israel and neighbouring Arab Gulf states hosting US military facilities. Although the Arab states did not retaliate and confined their actions to defensive measures, there was no doubt left that the disruption of oil supply from these states would create a huge energy crisis around the globe, which would disproportionately hurt developing countries like Pakistan that relied on imported energy. As world oil prices began to soar, the government wasted no time in increasing petrol and diesel prices by the unprecedentedly huge margin of Rs55 per litre on March 6 — despite the fact that government ministers had claimed a day earlier that they had sufficient fuel stocks for a month, which had been purchased at the old price. As anticipated, the price hike — popularly termed as the ‘petrol bomb’ even by serious newspapers like this one — led to an immediate and universal public backlash. The common theme in the harsh criticism by diverse segments of the population and media outlets was the lavish lifestyle of the government and its top officials. They asserted that the government routinely passes on the increase in petrol prices to the common people and expects them to make sacrifices but that senior government officials in all three branches of the state — the executive, legislature and judiciary — continue to enjoy free petrol quota, unlimited in some cases, not only for multiple vehicles for their personal use but also for fleets of automobiles earmarked for their protocol and security squads. The public criticism was so intense that the prime minister hurriedly got an elaborate austerity plan prepared over the weekend and on March 9 (the next working day) announced measures in a televised address to cut down on state expenses especially in relation to petrol and transport usage by senior government officials. This was a timely step before public criticism could escalate into street protests. Although the government was not in a position to withdraw the increase in petrol prices as the rising trend prevailed in the global market, the announced austerity measures did somewhat pacify the public sentiment. Provincial governments, parliament and the provincial assemblies also followed suit and announced their own set of austerity plans. So did the judiciary. The austerity plan is for a limited period and hence of limited benefit. The swift action by the government underscored the fact that elected democratic governments have to cater for public sentiments, no matter how flawed the electoral process which brought them to power is perceived to be and irrespective of the deficiencies in the quality of democracy. The hard part, however, is yet to come. The announced austerity measures can be grouped into two broad categories. One set of actions are substantial and will have a positive impact. Grounding 60 per cent of government vehicles, a blanket ban on foreign trips of government officials, doing away with iftar dinners and receptions, limiting protocol/ security vehicles to one for each official, restrictions on the use of hotels for government events, deferring the purchase of new vehicles, a 50pc cut in fuel allowances for federal ministers and officials, stoppage of total allowance in Punjab, and replacement of in-person meetings with online meetings to reduce travel appear to have resulted in considerable savings. In the second set of austerity measures, reducing the speed limit on motorways and highways seems to be a superfluous idea. Reducing the work week to four days from five without increasing the daily working hours may, in fact, be counterproductive as the speed of work, which in any case is never satisfactory, will slow down further and have a negative impact on decision-making. Getting half the staff to work from home will further eat into bureaucratic efficiency. Decreasing court days to four will increase the pendency of cases, which is already hurting the litigants. Online classes for educational institutions may not hurt if confined to a couple of weeks but past experience shows that this step can be discriminatory as not all students have proper access to the internet. A cut in the salaries of cabinet ministers and legislators is more symbolic than substantial and meant to show empathy with the suffering people. The austerity plan is for a limited period and hence of limited benefit. Effective implementation of the announced measures of either category will be another serious challenge. Monitoring fuel consumption by government officials will require an elaborate mechanism. The pace of work at government offices is already slow because generally, people are in vacation mode due to Ramazan and now the coming Eid holidays. However, the shortened work week, the work-from-home regime and online classes will seriously impact routine work after Eid unless serious adjustments are made to working hours and internet quality for long-term application of these measures. It is critical to accept the bitter reality that our official style of governance does not match the precarious and loans-afflicted state of our economy which will be further weakened because of high energy prices. The austerity measures should, therefore, not be restricted to just a couple of months or until the fuel crisis lasts; rather, they should be adopted as a long-term way of life and policy. The opulence which we reflect in the grandeur of our offices, official residences, multiple vehicles for top judges and government officials, state events, foreign trips, elaborate protocols etc. need to be replaced with a simple but effective way of governance. An ‘austerity commission’ may be constituted to develop a long-term austerity plan for all three branches of government with no leniency for any sacred cow. The writer is president of the Pakistan-based think tank Pildat. president@pildat.org X: @ABMPildat Published in Dawn, March 19th, 2026
DawnMarch 19, 2026 at 04:15 AM UTCForeign exchange constraints crop up in oil supply chain despite improvement in stock of petroleum products
ISLAMABAD: Despite improved stock covers of petroleum products, foreign exchange constraints have started to crop up in the oil supply chain due to additional costs of skyrocketing global prices, insurance and import premiums, and freight charges. The issue was formally raised at a meeting of the special cabinet committee formed to monitor petroleum prices, presided over by Finance Minister Muhammad Aurangzeb. The oil industry complained that credit limits for oil marketing companies (OMCs) in Pakistani currency remained unchanged, despite their foreign exchange requirements increasing more than double since the beginning of the US-Israel war on Iran. These limits were set when petrol and diesel prices in the global market were around $70 and $90 per barrel, which have now gone beyond $132 and $190 per barrel, respectively. Similarly, the situation with insurance costs, import premiums and freight charges has been affected because of longer haul voyages. The import premium has gone above $20 from less than $5-6 per barrel. As a consequence, commercial banks were not providing full foreign exchange coverage to their import requirements. Led by state-owned Pakistan State Oil (PSO), the industry demanded that the committee and the State Bank of Pakistan (SBP) intervene and enhance their credit limits or make any other arrangements they may deem appropriate for foreign exchange availability for oil imports. It was reported that both petrol and diesel stocks had improved over the past few days despite challenges. Petrol stocks now provide more than 29 days of coverage while diesel stocks provide 26 days of coverage. Crude stocks had also increased to 14 days while Saudi Aramco had promised to deliver two more cargoes by mid-April. An official statement said the committee was briefed that global petroleum markets remained “exceptionally tight, with recent increases observed in both benchmark prices and cargo premiums”. Members noted that the prevailing market conditions reflect supply-side uncertainties linked to regional developments, with premiums for upcoming cargoes expected to remain elevated in the near term. “It was highlighted that rising international prices have significantly increased the landed cost of imports, resulting in larger transaction sizes and placing pressure on existing financing arrangements,” the statement said, adding the committee discussed “operational challenges arising from the increased size of letters of credit (LCs) and emphasised the need for enhanced coordination between financial institutions and importers to ensure continuity of fuel imports”. The finance minister directed that the matter be taken up with the State Bank of Pakistan and the Pakistan Banks’ Association (PBA) to explore facilitation measures, including temporary enhancements and consortium-based financing where required. Meanwhile, the central bank governor assured the committee that any issues relating to prudential limits would be reviewed on priority, while banks were encouraged to adopt a flexible approach to accommodate higher transaction volumes in view of prevailing market conditions. The committee also undertook a detailed review of petroleum product stock positions and was briefed that, despite heightened volatility in international energy markets and evolving regional dynamics, domestic supply remained stable with adequate stocks available across the country. It was noted that diesel stocks currently provided approximately 24 days of cover, while petrol stocks remained at comfortable levels, supported by ongoing imports and refinery operations. The Petroleum Division reported that one cargo of crude oil had arrived and was under discharge, while another vessel is expected to reach Karachi harbour within hours. It said that additional shipments remained in transit, and further import arrangements for March and April were being actively managed to reinforce national reserves. Refinery throughput was also expected to improve as incoming cargoes are processed, with efforts underway to optimise production levels across facilities. The committee also reviewed demand patterns in the domestic market and noted indications of elevated offtake in recent weeks. Members emphasised the importance of close monitoring to discourage speculative stockholding and ensure that fuel availability remains smooth across the distribution network. Provincial administrations and regulatory authorities were directed to intensify oversight, including inspections and enforcement actions where necessary. In view of the upcoming Eid holidays and the ongoing harvesting season, the committee reviewed supply continuity arrangements and was informed that OMCs would maintain operational readiness to meet demand. It was reiterated that depots would remain functional in line with commercial requirements, and no disruption in fuel availability was anticipated during this period, the statement said. The meeting also reviewed progress on strengthening monitoring mechanisms, including the development of a digital dashboard aimed at improving real-time visibility of stock levels and supply conditions. The finance minister emphasised the need for timely data integration and directed all stakeholders to ensure prompt sharing of information to support informed decision-making. Members were also briefed on ongoing engagements with international partners to diversify supply sources and mitigate potential disruptions. It was noted that discussions with key suppliers, including under government-to-government arrangements, were progressing, with additional volumes expected to strengthen supply security in the coming weeks. Aurangzeb told the meeting that the government’s foremost priority was to ensure the uninterrupted availability of petroleum products across the country while minimising the burden on the public. He observed that while international markets continue to exhibit volatility and upward price pressures, proactive planning and coordinated efforts have helped maintain a stable domestic supply position. In its Monday meeting, the committee was informed that the March requirements were fully secured and, based on current cargo planning and supply arrangements, coverage was available up to mid-April. Unprecedented surge in global oil prices due to the blockade of Strait of Hormuz — a key waterway for ships — has also impacted Pakistan, with the government hiking the prices of both petrol and high-speed diesel by Rs55 from March 7. While the government kept the petroleum prices unchanged, it increased the price of kerosene oil by Rs40 per litre on Sunday — the last review day under the weekly revision plan.
DawnMarch 18, 2026 at 01:47 PM UTC