Pakistan grapples with soaring fuel prices as inflation surges.

Pakistan witnessed a historic surge in petrol and high-speed diesel prices on Friday, as the caretaker federal government implemented significant price hikes. According to a report by Dunya News, the price of petrol has surged by Rs 26.02 per litre, while high-speed diesel saw an increase of Rs 17.34 per litre.

Starting from today (Saturday), the new price for petrol stands at Rs 331.38 per litre, reflecting the substantial increase of Rs 26.02 per litre. High-speed diesel, on the other hand, now costs Rs 329.18 per litre following a hike of Rs 17.34 per litre.

This decision comes on the heels of an unexpected move by the central bank, which opted to maintain its benchmark interest rate at 22%. The central bank cited concerns over inflation, which it anticipates will rise significantly in September before gradually slowing down in October and beyond. The country experienced a sharp 27.4% increase in consumer prices in August, underscoring the gravity of the inflationary pressures.

Pakistan, grappling with rising inflation and dwindling foreign exchange reserves, finds itself in the midst of a profound economic crisis. The nation has been striving to chart a course towards economic stability, having secured a $3 billion IMF loan agreement in July.

The finance division, explaining the rationale behind the fuel price hikes, pointed to the surge in international petroleum prices over the past fortnight. These global market dynamics have compelled Pakistan to adjust domestic fuel prices to align with the international trend, despite the inevitable burden it places on its citizens.