KARACHI: Pakistan warned on Friday it has limited fiscal space to provide fuel price relief, even as authorities said supplies remain stable with stocks sufficient for around four weeks and additional shipments in the pipeline.
The government’s position came during a meeting chaired by Finance Minister Muhammad Aurangzeb on petroleum prices amid volatile global oil markets, as the war in Iran rages despite efforts by mediating countries to end the conflict.
“The Finance Division briefed the participants on the fiscal situation and noted that limited fiscal space is available, primarily confined to revenues from the petroleum levy,” said an official statement circulated after the meeting attended by senior federal and provincial officials. “It was emphasized that any relief measures would need to be carefully calibrated to maintain macroeconomic stability.”
In his remarks, the Finance Minister underscored that the current situation should be treated as an opportunity to undertake structural reforms rather than a constraint.
He emphasized the importance of adopting data-driven decision-making, particularly in the areas of taxation and subsidy design, to ensure transparency, efficiency and better targeting of relief.
Aurangzeb also highlighted the need to promote responsible consumption behavior and ensure that policy responses remain fiscally prudent while maximizing relief for the public.
Speaking to Arab News, the country’s finance adviser Khurram Schehzad said Pakistan “has sufficient fuel stocks for around four weeks, with coverage improving further as additional supplies are in the pipeline.”
“Stock levels have strengthened in recent weeks due to improved planning and management, while strong relationships with key partner countries are ensuring smooth and prioritized inflows,” he added.
In a recent television interview, Schehzad noted that fuel prices were the government’s real concern.
“The prices have increased all over the world, especially in this region,” he told Geo TV. “The price of diesel and petrol has increased from 30 percent to 70 percent.”
The Finance Division said in its statement that officials are trying to develop a technology-based system to offer targeted subsidies more efficiently and transparently.
Punjab Senior Minister Marriyum Aurangzeb said during Friday’s meeting any decline in international petroleum prices should be passed on to consumers, while also highlighting the need to incorporate behavioral measures to promote more sustainable fuel consumption.
Authorities have already been encouraging conservation and austerity measures as part of the policy response.
Data released by the Karachi Port Trust showed Pakistan imported nine fuel vessels between March 1 and 27, including seven carrying crude oil and two with petrol, highlighting continued inflows to support supply stability.
