Pakistan Navigates Fuel Supply Concerns Amidst Middle East Conflict

Islamabad – Pakistan is taking steps to secure fuel supplies and mitigate economic fallout as the conflict in the Middle East disrupts maritime traffic and drives up global oil prices. The government has implemented austerity measures and is actively diversifying its energy supply sources to ensure stability.

Fuel Price Hikes and Austerity Measures

On March 6, 2026, Pakistan raised retail prices for both petrol and diesel by approximately 20%, a direct response to increasing oil prices stemming from tensions in the Middle East [Reuters]. Prime Minister Shehbaz Sharif announced sweeping austerity measures on March 10, 2026, including a shift to a four-day workweek for government employees and spring holidays for schools from March 16th through the end of the month [Al Jazeera]. Fifty percent of government staff will work from home on a rotating basis, with exemptions for key sectors like banking.

Current Fuel Reserves and Supply Outlook

Despite the challenging environment, Pakistan’s Finance Ministry stated on March 11, 2026, that the country is “adequately positioned in terms of fuel availability,” with March requirements fully secured and coverage extending to mid-April [Reuters]. Efforts are underway to extend coverage through the end of April. According to the Petroleum Secretary Hamed Yaqoob Sheikh, Pakistan currently has sufficient petrol reserves for 27 days and diesel reserves for 21 days [Al Jazeera]. Jet fuel (JP1) reserves are available for 14 days, crude oil for 11 days, and liquefied natural gas (LNG) for nine days.

Diversifying Supply and Addressing Potential Shortages

The government is prioritizing the diversification of fuel supply sources to enhance the resilience of the national energy supply chain. Procurement strategies are being adjusted to broaden sourcing from the international market and reduce reliance on any single supply corridor [Reuters]. Concerns remain regarding LNG supplies, with deliveries from Qatar halted since March 2, 2026, impacting gas supply to the fertilizer and power sectors [Al Jazeera].

Government Response and Market Monitoring

Finance Minister Muhammad Aurangzeb has reassured the public that the government is fully focused on ensuring uninterrupted fuel availability and that the current stock position and supply outlook remain stable. He urged citizens not to engage in panic buying or stockpiling [Reuters]. Authorities are closely monitoring stock levels and market activity to prevent hoarding, with strict legal consequences for any attempts to create artificial shortages. A newly introduced feature on the “PAK App” allows consumers to report fuel unavailability or inflated prices.

Economic Impact and Inflation Concerns

The Middle East conflict and rising oil prices are contributing to economic pressures in Pakistan. If global oil reaches $130 per barrel, petrol prices in Pakistan could rise to approximately Rs392 ($1.4) per liter, potentially increasing inflation by 7.11 percent [Arab News]. The government is working on a relief package for motorcycle and rickshaw owners to mitigate the impact of higher fuel costs.

Impact on Regional Economies

The situation is not unique to Pakistan. Reports indicate that 60% of India’s petrol imports have been affected, with countries across the region striving to secure fuel supplies [Al Jazeera]. Two Pakistani ships are currently stuck in the Strait of Hormuz.