Petrol prices in Pakistan could cross Rs. 1,000 per litre if international oil prices reach $200 per barrel and the government ends fuel subsidies, an independent energy market analyst has warned, as shipping disruptions around the Strait of Hormuz threaten global supplies.
Russell Hardy, chief executive of Vitol Group, warned this week that oil could reach $200 per barrel if shipments through the Strait of Hormuz and the Gulf of Oman face further disruption.
“Oil is currently trading at around $103 per barrel, while petrol costs around Rs. 400 per litre in Pakistan. If oil prices hit $200 per barrel and IMF forces Pakistan to end all subsidies, petrol will certainly cross Rs. 1,000 per litre and wreak havoc,” an independent energy market analyst told RBN in response to questions about Vitol’s forecast.
Speaking at the Energy Intelligence Forum in London on October 6, Hardy said ship-to-ship oil transfers in the region remain crucial to maintaining supplies from Gulf producers. He warned that Western oil inventories have little remaining capacity to cushion further disruptions.
“Without it, you do have that $200-a-barrel scenario, so it is pretty important it continues,” Hardy said.
Ship-to-ship transfers involve smaller vessels carrying oil through the Strait of Hormuz before transferring their cargo to larger tankers in the Gulf of Oman. The arrangement has become increasingly important as conflict-related risks complicate shipping through the region.
Around 14 million barrels per day of oil and petroleum products left the Middle East over the previous seven to 10 days, according to Hardy. This included approximately 12 million barrels per day of crude oil and 2 million barrels per day of refined products.
Although these flows remain below pre-war levels, their continuation is helping prevent further pressure on international oil prices.
However, attacks on vessels and the US blockade are adding to shipping risks. At least 12 incidents involving attacks, attempted attacks or harassment of tankers were recorded around the Strait of Hormuz between September 28 and October 5, according to Reuters.
The Bab al-Mandeb Strait is another important shipping route that could influence energy prices if regional tensions spread further.
Shipping costs have also surged as operators face greater risks and uncertainty. Hardy warned that the oil market has increasingly become a shipping crisis, with limited tanker availability adding pressure to the cost of moving crude and refined products.
The independent analyst told RBN that some tankers are earning at least $500,000 per day, while shipping costs for Saudi oil exports to Europe have approached $40 per barrel.
Any further deterioration in maritime security could restrict oil flows, tighten global supplies and push prices higher. For Pakistan, which imports oil and remains exposed to international price movements, a sustained rally could increase fuel costs and intensify pressure on households and businesses.
However, petrol crossing Rs. 1,000 per litre remains a worst-case scenario based on the analyst’s assumptions, not an announced or confirmed price forecast for Pakistan.
