Oil prices surge 10pc amid Iran conflict, Pakistan may face rising fuel costs
ISLAMABAD/LONDON (Web Desk) – Global oil prices surged sharply amid escalating tensions in the Middle East following US and Israeli strikes on Iran, sending Brent crude up 10% to around $80 per barrel. Analysts warn prices could hit $100 per barrel if the Strait of Hormuz remains blocked.
Ajay Parmar, Director of Energy and Refining at ICIS, said the critical factor driving the surge is the closure of the Strait of Hormuz, through which over 20% of global oil passes. Most tanker operators, oil majors, and trading houses have suspended shipments following warnings from Tehran.
For Pakistan, which relies heavily on imported oil, the spike is expected to increase the cost of petroleum products, putting additional pressure on the government’s energy subsidies and inflation. Officials say the rise could further strain the country’s current account and increase fuel prices for consumers.
Rystad Energy estimates that the disruption could cut global crude supply by 8 to 10 million barrels per day, potentially pushing prices above $90 when markets reopen. OPEC+ announced a modest production increase of 206,000 barrels per day starting in April, which is unlikely to offset the shortfall.
Analysts warn Pakistan may face higher fuel import bills, impacting electricity generation, transport costs, and industrial sectors. Asian refiners, including India, are already assessing alternative sources, such as Russian crude, to compensate for potential Middle East supply losses—a strategy Pakistan may also need to consider.
Energy experts in Islamabad say the government may need to adjust petrol and diesel prices in coming weeks while exploring strategic reserves and alternative supply routes to mitigate economic impacts.
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