By The South Asia Times

ISLAMABAD - Pakistan has raised the prices of petrol and high-speed diesel again, adding to growing concerns over the impact of frequent fuel price changes on households, transport operators and businesses already struggling with high living costs.

The government increased petrol prices by Rs5.58 ($0.02) per litre and high-speed diesel (HSD) by Rs4.18 per litre, with the new rates taking effect from Wednesday, September 9.

Petrol will now cost Rs364.35 per litre, while diesel will be sold at Rs385.95 per litre, according to a notification issued by the Petroleum Division.

The government continues to collect Rs114 per litre in taxes and duties on petrol and Rs100 per litre on diesel, adding significantly to the final price paid by consumers.

The latest increase comes after Pakistan shifted from weekly to daily fuel price revisions, citing volatility in international oil markets linked to renewed conflict and tensions in the Middle East.

Petroleum Minister Ali Pervaiz Malik announced in July that the Oil and Gas Regulatory Authority (OGRA) would determine fuel prices on a daily basis in line with international market movements.

The move has exposed consumers to more frequent changes in fuel costs, making it increasingly difficult for households, transport operators and businesses to predict their expenses.

For ordinary Pakistanis, petrol prices are particularly significant because petrol is widely used by private cars, motorcycles, rickshaws and other small vehicles.

Diesel prices have an even broader economic impact because HSD is heavily used by trucks, buses, agricultural machinery, power plants and industrial generators.

Despite the latest increase, current prices remain below the extraordinary peaks recorded earlier this year.

Diesel reached Rs520.35 per litre on April 3, after rising from around Rs281 per litre following the outbreak of the US-Iran conflict on February 28.

Petrol similarly climbed to Rs458.41 per litre on April 3, after beginning its sharp rise from around Rs266 per litre in early March.

Although prices have subsequently fallen from those record levels, the latest increases underline the continuing vulnerability of Pakistan's economy to international energy-market shocks.

Petrol and diesel are also among the government's largest sources of petroleum-related revenue, with combined monthly sales running into hundreds of thousands of tonnes. Kerosene demand, by comparison, is only around 10,000 tonnes a month.

Repeated fuel price increases can have a cascading effect across Pakistan's economy.

Higher diesel costs raise the expense of transporting food, agricultural products and manufactured goods, while higher petrol prices directly increase commuting costs for millions of workers.

Transport operators are also likely to seek higher fares to compensate for increased fuel expenses, potentially putting additional pressure on consumers.

For Pakistan's already financially stretched middle- and lower-income households, the shift to daily pricing means fuel costs can become a more unpredictable component of monthly household spending.

The government has previously announced fuel-conservation measures and targeted subsidies aimed at cushioning vulnerable consumers from the impact of the energy crisis.

But with fuel prices now subject to daily adjustment, the government's challenge is becoming increasingly difficult: protecting consumers from a volatile global oil market while maintaining revenue and managing the country's already severe economic pressures.