Pakistan Rejects Fuel Price Hike Despite Rising Global Oil Costs

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Pakistan has decided against raising fuel prices ahead of Eid al-Fitr, with Prime Minister Shehbaz Sharif announcing the government will absorb the financial impact to shield consumers from further cost pressures.

The move comes weeks after Islamabad increased petrol and diesel prices by nearly Rs 55 per liter, following a surge in global oil prices linked to the ongoing conflict involving Iran, the United States and Israel. The hike pushed petrol prices above Rs 320 per litre and diesel close to Rs 336, intensifying inflationary pressures by raising transport, food and retail costs during the peak festive season.

In a televised address, Sharif said he had been advised to raise petrol prices by Rs 76 per litre and diesel by Rs 137 per litre, but chose to reject the proposal.

“Under the pretext of responsibility, especially as Eid approaches, I have decided not to increase fuel prices,” he said.

The prime minister noted that the government would bear the financial burden of the decision, estimated at Rs 24 billion, while making adjustments to development spending to offset the impact.

He said the move was aimed at easing pressure on households already grappling with inflation and underscored the need for collective resilience during challenging economic conditions.

“We can overcome this crisis with the spirit of sacrifice,” Sharif added.

Pakistan’s inflation has moderated to around 6–7 percent in recent months after peaking at 38 percent in 2023, but fuel costs remain a key driver of broader price increases across the economy.