ISLAMABAD: Pakistan on Monday announced it had established a high-level cabinet committee to monitor petroleum markets and ensure uninterrupted domestic fuel supplies, as escalating conflict in the Middle East and disruption around the Strait of Hormuz rattle global energy markets.
The Finance Division said the newly constituted ‘Committee to Monitor Petrol Prices in the Wake of the Emerging Situation in the Region’ held its first meeting under Finance Minister Senator Muhammad Aurangzeb, undertaking a comprehensive review of fuel stocks, supply chains and pricing risks.
The move comes after Iran closed the Strait of Hormuz following US-Israeli strikes inside Iranian territory, raising concerns about oil shipments through the strategic waterway that carries roughly one-fifth of global oil consumption.
Pakistan relies heavily on Middle Eastern crude and petroleum products that transit through the strait.
“The Committee will operate as a strategic governance forum to continuously monitor developments and undertake structured scenario planning,” the finance ministry said in a press release. “Ensuring availability of energy supplies across the country is the Government’s primary objective and will remain the central driver of all decisions.”
The committee reviewed trends in forward and futures petroleum prices, assessed global freight and insurance costs, examined shipping route dynamics and alternate sourcing options, and evaluated potential short- and medium-term foreign exchange implications of price volatility.
It also noted that closure of the Strait of Hormuz and tensions around the Bab Al-Mandeb Strait pose significant challenges for global energy security and could have implications for Pakistan’s energy supply chain if prolonged.
The Finance Minister emphasized that there is “no immediate supply stress” and said maintaining market confidence and orderly conditions remains essential. He directed relevant entities to intensify coordination, validate physical stock positions and closely track shipments and storage.
The finance ministry added that the committee will convene daily to review international price movements, domestic stock levels, foreign exchange exposure and supply chain developments in real time.
Beyond immediate supply availability, officials are also evaluating the potential fiscal and inflationary impact of a prolonged conflict. Rising oil prices could increase Pakistan’s import bill and pressure foreign exchange reserves, while higher freight and war-risk insurance premiums may further elevate costs.
Separately, energy regulators and industry officials have confirmed that current fuel inventories remain adequate.
“Fuel inventories remain robust, with 28 days’ supply of both petrol and diesel currently available in stock,” OGRA spokesman Imran Ghaznavi told Arab News on Sunday. “This level is comfortably above the mandatory reserve requirement, indicating a stable and well-managed supply position.”
An official at the energy ministry, speaking on condition of anonymity, said finished petroleum stocks were sufficient to last “over one month.”
State-owned Pakistan State Oil (PSO) also said it held a “healthy stock of all petroleum products,” adding that the situation was being closely monitored in line with Ministry of Energy directives.
Analysts warn that any sustained disruption in Hormuz traffic could trigger sharp global price spikes.
“If the Strait of Hormuz is impacted [for long], this may create a shortage of oil supply in region and world as material amount of oil passes through this track,” said Shankar Terleja, head of research at Topline Securities Ltd. “This may cause spike in petroleum prices globally.”
Ahsan Mehanti, chief executive officer of Arif Habib Commodities, described the strait as “highly critical” to Pakistan’s energy supplies, warning that prolonged closure could impact “security and industrial activity.”
Business leaders have also urged contingency planning. Federation of Pakistan Chambers of Commerce and Industry (FPCCI) President Atif Ikram Sheikh said regional instability could disrupt trade routes and increase shipping costs, calling on the government to “immediately formulate a policy to ensure supply chain continuity, particularly for petroleum products.”
