By SKM
March 2, 2026
ISLAMABAD: With crude markets rattled and tankers stalled near the Gulf’s most sensitive chokepoint, Islamabad has moved into crisis mode, forming a high-level “war-room” to shield the economy from a potential oil shock triggered by escalating US–Israel tensions with Iran.
The Prime Minister’s Office on Monday constituted an 18-member committee headed by the finance minister to monitor global petroleum prices, assess foreign exchange risks and prepare emergency supply plans. The body will meet daily as fears grow that disruptions in Gulf shipping lanes could send oil prices spiralling.
The committee includes the ministers for petroleum and power, the minister of state for finance, the governor of the State Bank of Pakistan, secretaries of finance, petroleum and power, the chairman of the Federal Board of Revenue, senior officials from the Prime Minister’s Office, and the heads of key energy institutions including the Oil and Gas Regulatory Authority, Pak-Arab Refinery Company, Pakistan State Oil, Pakistan LNG Limited, Sui Northern Gas Pipelines Limited and SSGC LPG. Representatives of intelligence agencies are also part of the forum — a sign that authorities are bracing for broader economic and security repercussions.
Hormuz Flashpoint
At the centre of global concern is the Strait of Hormuz, the narrow maritime artery through which nearly 20–21 million barrels per day of crude and petroleum products — roughly one-fifth of global consumption — flowed in 2023–24. Around a fifth of global LNG exports, mainly from Qatar and the United Arab Emirates, also transit the strait toward Asian markets.
Brent crude has already climbed above $78 per barrel, and traders warn that a prolonged standoff or blockade could drive prices into the $100–$150 range — levels that would severely test Pakistan’s fragile external position.
Supply Lines Under Strain
Pakistan’s dependence on Gulf energy supplies leaves it acutely exposed. The country imports LNG from Qatar, diesel from Kuwait and significant volumes of crude from the Abu Dhabi National Oil Company — shipments that ordinarily pass through Hormuz.
Officials confirmed that two crude oil tankers — including MT Karachi, operated by the Pakistan National Shipping Corporation — are currently stranded in or near the strait. Another cargo awaiting loading is unlikely to sail under prevailing conditions. LPG imports have also slowed sharply, raising the spectre of domestic price spikes.
Two LNG cargoes that crossed Hormuz before the escalation are expected to dock in coming days, providing only short-term relief.
Economic Tightrope
The committee’s mandate includes tracking forward and futures prices, evaluating forex implications in the short and medium term, preventing supply disruptions and analysing fiscal fallout in case the conflict drags on.
Yet the formation of the body also lays bare a recurring vulnerability: Pakistan’s heavy reliance on imported fuels and its limited buffer against global price swings.
A sustained $10–$20 jump in crude prices could inflate the import bill, widen the current account deficit and intensify pressure on the rupee. Passing higher fuel costs on to consumers risks fuelling inflation; absorbing them through subsidies would strain public finances already under discipline commitments. Ends
