The government is expected to absorb the impact of a sharp rise in global oil prices—estimated at up to Rs49 per litre—in an effort to protect domestic consumers amid escalating tensions in the Gulf region.

Market calculations indicate that high-speed diesel prices have increased by up to Rs49 per litre, while petrol prices have risen by around Rs29 per litre. Despite this surge, authorities are likely to keep retail prices stable by compensating oil marketing companies through price differential payments.

The international oil market has seen significant volatility, with benchmark prices climbing sharply. Dubai crude has surged past $166 per barrel, while diesel and gasoline prices have also posted notable gains, intensifying pressure on import-dependent economies such as Pakistan.

To manage the impact, the government has previously adjusted prices of other petroleum products, including kerosene and light diesel oil, while keeping petrol and diesel rates unchanged through the use of subsidies and petroleum levies.