PM flags growth risks as Iran war drives oil surge

Says weekly oil bill surged to $800 million Govt to determine new POL prices on Friday

ISLAMABAD:

Prime Minister Shehbaz Sharif, expressing concern over rising global crude oil prices, on Wednesday noted that new prices were expected to be determined on Friday.

Chairing a federal cabinet meeting in Islamabad, the prime minister said this was a very challenging situation, but he expressed the confidence that collective wisdom and coordinated efforts would keep matters under control.

The prime minister said the war in the Middle East had impacted Pakistan's growth, with the oil bill surging to $800 million weekly.

The prime minister said that Pakistan was heading towards a growth trajectory after achieving macro-level stability, but the US-Iran war had impacted the collective efforts of the past two years.

He stated that crude oil prices were once again soaring, "We have to determine new prices by this coming Friday. The current global market situation presents a major challenge. However, thanks to collective foresight and joint efforts, we have made significant attempts to manage this situation more effectively."

"I would like to congratulate Minister of Petroleum Ali Pervez Malik and the entire team for their collaborative efforts in implementing effective measures. As a result, unlike other countries, we did not face long queues or the need for rationing. Overall, the situation has been satisfactory," he said.

The prime minister further explained that global market prices reflect the extent of the challenge. "Before the war, our weekly oil bill was approximately $300 million, which has now surged to $800 million. We are continuing our efforts to save, and in recent days, we have seen positive progress, with our consumption significantly reduced compared to last week."

Speaking about payments to the UAE, the prime minister said, "Our outstanding external debts (including approximately $3.5 billion in bilateral loans) have, thank God, been paid off. Our foreign exchange reserves are also stable at their current level, and we have made our debt repayments."

"We are extremely grateful to King Salman bin Abdulaziz and Crown Prince Mohammed bin Salman for playing a key role in this matter. I am confident that these major issues will also be resolved. Pakistan's efforts for peace continue, and there has been no reduction in them," he added.

He further mentioned that he had directed the committee working with the provinces to continue consultations for a month to ensure that the subsidies being provided could be maintained.

The prime minister also updated the cabinet on Pakistan's diplomatic engagement, which led to talks between Washington and Tehran in Islamabad. "The talks between Iran and the US that took place on the night of April 11 lasted nearly 21 hours. It was a long marathon session. Pakistan made sincere and concerted efforts to bring peace to the region," he said.

He also commended the Chief of Army Staff and Chief of Defence Forces, Field Marshal Asim Munir, Deputy Prime Minister and Foreign Minister Ishaq Dar, and other key figures who played a significant role in these efforts. "As a result of these efforts, the ceasefire was extended, and it remains in effect."

Regarding Iran's Foreign Minister Abbas Araqchi's visit with his team for the second round of talks, PM Shehbaz said, "Important meetings were held during his visit. Before his trip to Russia, I had a phone conversation with him in which he assured me that all his meetings in Oman were conducted with sincerity, and after consulting with their leadership, they will give a positive response soon."

According to a statement issued by the Prime Minister's Office (PMO), several important policies were approved during the meeting.

The statement noted that the cabinet approved the national vaccine production policy, aimed at reducing reliance on vaccine imports, saving foreign exchange, and making Pakistan self-sufficient in vaccine production. "A special committee under DRAP will be set up to ensure pricing and quality control," it added.

The cabinet also approved the first-ever National Agriculture Biotechnology Policy, which aimed "to ensure national food security, boost agricultural productivity, and advance research and development in the sector," according to the statement.

The National Seed Policy 2025, which aimed to increase agricultural production by 15 to 20 per cent and empower farmers, was also approved. "The policy includes steps to partner with global seed companies," it said.

Additionally, the cabinet granted approval for the National Skills Development Policy, which focuses on aligning the workforce with industry needs and modern requirements.

"It also includes provisions for international training and certification for Pakistanis going abroad for work. Cooperation between the federal government, provinces, and the private sector will be essential for implementing this policy," the statement continued.

Furthermore, the cabinet approved the FDE (Visiting Faculty) Regulations 2025, allowing teachers serving on daily wages in grades 1 to 15 to be hired as visiting faculty based on their qualifications, in line with a Supreme Court decision.

"The meeting also reviewed the NEPRA Annual Report 2025 and the State of Industry Report 2025," it added.