Pakistan's government implemented substantial fuel price increases on Friday, raising petrol by Rs5.44 per litre and high-speed diesel by a steep Rs31.05 per litre, effective immediately for the next three days. The move, which pushes petrol to Rs316.15 and diesel to Rs354.35 per litre, comes as authorities simultaneously shift to a daily pricing mechanism to better track volatile international markets amid renewed Middle East tensions. Main Developments The new rates took effect from July 18 and will remain in place until July 20, after which daily adjustments will apply under a newly adopted system. Diesel prices have fallen significantly from their peak of Rs520.35 recorded on April 3, while petrol's peak of Rs458.41 on the same date also marked a high point before the latest round of increases. Read also: Pakistan Shifts to Daily Fuel Pricing to Curb Political Interference Petroleum Minister Ali Pervaiz Malik announced that fuel prices would now be fixed on a daily basis due to fluctuations in international market prices following renewed hostilities between Iran and the US. The government has tasked the Oil and Gas Regulatory Authority (Ogra) with determining these daily rates based on international market trends, with Ogra also required to publish the factors behind the prices seen at each pump. Background Since early March, the government had been announcing weekly fuel price revisions alongside conservation measures amid potential oil supply disruptions from the Middle East conflict. Diesel prices began their upward trajectory from Rs281 per litre after the US-Iran war broke out on February 28, while petrol started rising from Rs266 in the first week of March. The government in April also introduced targeted relief measures to provide subsidised fuel to affected segments. Currently, the government charges approximately Rs105 per litre on both petrol and diesel through customs duty, along with additional levies including the petroleum levy, climate support levy, and inland freight equalisation margin. Why It Matters Petrol is primarily used in private transport, small vehicles, rickshaws, and two-wheelers, directly affecting the middle and lower-middle classes. Diesel price changes have broader economic consequences as it powers heavy transport, power plants, and large generators. Together, petrol and high-speed diesel generate monthly sales of about 700,000 to 800,000 tonnes—far exceeding the 10,000 tonnes monthly demand for kerosene—making them critical revenue earners for the government. What's Next Ogra will begin publishing daily fuel prices and the underlying pricing factors on its website. The All Pakistan Dealers Association has rejected the daily pricing decision and plans to consider a protest strategy next week. The three-day window before the new system takes full effect may test both administrative readiness and public acceptance of the more frequent adjustments.