Pakistan is considering implementing fuel rationing due to a worsening energy crisis, exacerbated by disruptions linked to the US-Iran conflict, which is pushing the already fragile economy to the brink. Finance Minister Muhammad Aurangzeb suggested that fuel rationing could be an option if the conflict prolongs, although the government is currently focusing on price increases and subsidies to manage demand.
Aurangzeb stated that utilizing price adjustments along with targeted subsidies is preferable to rationing, but the decision may depend on the duration and severity of the situation. The escalating global oil prices, driven by uncertainties surrounding the vital energy supply route of the Strait of Hormuz, have significantly impacted Pakistan, a nation heavily reliant on oil imports.
Following supply disruptions, the Shehbaz Sharif government implemented extensive austerity measures, including closing schools for two weeks, reducing fuel allocations for official vehicles, enforcing a four-day work week for government employees, and implementing a rotational work-from-home policy for half of the government staff. Additionally, restrictions were placed on weddings and menus in an effort to curb expenses.
Despite these measures, citizens continue to face economic challenges as petrol and diesel prices have surged by up to 54%, exacerbating existing inflation pressures. Petroleum Minister Pervez Malik defended the price hikes as essential. Furthermore, daily power cuts of up to two hours have been introduced to manage electricity costs, leading to public discontent due to disruptions in daily life and business operations.
Although Aurangzeb warned about the potential for unrest if rationing is implemented, the ongoing tightening of restrictions suggests that Pakistan may be running out of viable solutions to address the escalating crisis.