Report by SCN News Desk
Pakistan could face serious economic pressure due to rising oil prices linked to the Middle East conflict, Planning Minister Ahsan Iqbal warned, highlighting risks to the country’s external sector and overall stability.Speaking at the launch of the Monthly Development Report, Iqbal said the conflict has emerged as a major global shock, driving up energy costs and inflation, while increasing Pakistan’s import bill due to its heavy reliance on fuel imports.
Despite these challenges, he noted that Pakistan’s economy showed signs of stabilisation, with growth improving to 3.8% in the first half of FY2026, compared to 1.9% last year. However, inflationary pressures have resurfaced, with March inflation rising to 7.3%, mainly due to higher energy and transport costs.
The minister warned that disruptions in global energy routes, particularly the Strait of Hormuz, could further strain Pakistan’s economy. He said the government had partially absorbed fuel price increases, bearing a fiscal cost of Rs129 billion to protect consumers, while also introducing relief measures in April.
On the external front, remittances remained strong at $30.3 billion, while exports stood at $30.6 billion, but rising imports widened the trade deficit. The current account posted a modest surplus, supported by growth in services exports.
Iqbal said Pakistan is moving towards economic stabilisation through reforms and fiscal discipline, but cautioned that global uncertainties, especially energy shocks, remain a key risk.