Pakistan is in a stronger position to deal with another major oil price shock than it was in 2022, according to Moody’s analyst Grace Lim.

Lim said Pakistan has built stronger economic buffers over the past two years, helped by lower inflation, a more stable exchange rate and higher foreign exchange reserves.

These improvements give the country more room to absorb the impact of rising energy prices as the Middle East conflict pushes global oil prices higher.

Pakistan has already increased petrol prices by Rs12.90 per litre and high-speed diesel prices by Rs3.72 per litre.

Brent crude was trading around $99 per barrel on Tuesday after rising 2.06%, while US West Texas Intermediate increased 3.2% to $94.41.

The latest oil shock is also raising concerns about supply disruptions through the Strait of Hormuz, a major global oil shipping route.

Lim said Pakistan’s stronger macroeconomic position provides greater protection against the external shock compared with the situation during the 2022 oil crisis triggered by Russia’s invasion of Ukraine.