The government of Pakistan has sharply raised petrol and diesel prices by Rs 55 per litre, effective March 7, 2026. Petrol now costs Rs 321.17 per litre, while high-speed diesel stands at Rs 335.86 per litre. This marks one of the largest single increases in recent years and stems directly from surging global crude oil prices triggered by the ongoing conflict in the Middle East involving Iran, Israel, and the United States.
The adjustment follows a dramatic climb in international oil benchmarks. Brent crude has risen above $90 per barrel—reaching levels around $92 in recent trading—after attacks and retaliatory actions disrupted supplies. The Strait of Hormuz, through which about 20% of the world’s oil flows, faces major risks, leading to halted tanker traffic, higher freight charges, and sharply increased insurance costs for vessels in the region.
Breakdown of the Price Changes
According to data from market analysts, the ex-refinery price for petrol went up by Rs 36.29 per litre. The petroleum levy on petrol was raised by Rs 20.97, bringing it to Rs 105.37 per litre. For diesel, the ex-refinery price jumped Rs 78.24 per litre, but authorities cut the petroleum levy by Rs 20.97 to Rs 55.24 per litre. These offsetting changes in the levy kept the net retail increase at Rs 55 for both fuels.
The move aims to align domestic rates with import realities amid volatile global markets. Pakistan, heavily reliant on imported oil, faces higher costs as disruptions limit supply routes and drive up expenses.
Background on the Global Trigger
The price surge ties to escalating violence in West Asia. U.S. and Israeli strikes on Iran, followed by Iranian responses, have rattled energy markets. Reports show tanker queues building outside the Strait of Hormuz, with some routes effectively blocked. This has pushed crude prices to multi-year highs in a short period, creating immediate pressure on oil-importing nations.
Officials from the Petroleum Division noted that the country holds adequate fuel stocks for now. Finance Minister and other government figures have urged calm, stating no immediate shortages are expected. However, they warned that future prices could shift based on how the Middle East situation develops.
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The increase is likely to raise transport fares, food prices, and overall living costs across Pakistan. Public reaction has been swift, with many expressing concern over the added burden during already tough economic times.
