Prices for petrol and high-speed diesel have been increased byRs 1.77 per litre and Rs 2 per litre by the government. This rise reflects the general upwards trend of the global prices for crude oil and petroleum products. The primary reason for this increase is that an agreement has been reached between the Organization of the Petroleum Exporting Countries (OPEC) – the international cartel of oil producing countries including Iran, Iraq and Saudi Arabia etc and non-OPEC countries such as Russia to keep a maximum bar at the amount of production of oil. This will keep the supply of oil in the market restricted which would increase the overall price of crude oil in the international market. Domestically, Pakistan has been reaping the benefits of the low crude oil price in various ways. Firstly, it has freed up a great chunk of its annual budget, which previously was used up for paying for its oil imports, to stick to and fulfil the conditions of the IMF’s loan program. The inflation level was kept down for almost all of the goods sold within the domestic market barring some exceptions for which other factors had come into play. The benefit of low prices was also partially passed down to the consumers who experienced relief with regards to fuel prices. Suffice to say, the low oil prices proved quite useful for Pakistan’s economy. However, the question whether Pakistan’s economy can fend off any future upwards volatility in the oil prices needs further probing into. It is essential that Pakistan’s economy develops enough resilience to the prices in the international oil market, even though the forecasts of the international oil market indicate that the price of crude oil and petroleum products will remain low for the foreseeable future. The reason being the same as the one that caused the crash in oil prices previously i.e. the abundance of oil supply in the international market. A couple of years ago, the US had jacked up domestic production of crude oil, revolutionized from the process of fracking, in order to decrease its reliance on oil imports. The OPEC, alongwith the major non-OPEC oil producers such as Russia, refused to lessen their production in fears of losing their market share bringing the prices down. With the aforesaid new agreement in place, the prices will start to crawl up in the international market temporarily. Because the higher prices will induce the fracking industry within the US, which was sitting idly by due to the lessened demand, to start its oil production again and make profit, thereby increasing the oil supply in the market. With this forecast, Pakistan can expect to stay comfortable. However, for a long-term approach, depending upon the low oil prices is a riskier option than to invest in domestic supply of energy, renewable and otherwise, to marginalize dependency on oil imports. On 15th of May of the year 2016, Germany ran entirely on renewable energy, shedding its dependency on oil imports for its energy demands; and, providing a roadmap for countries unable to meet their energy demands domestically. Can the concerned quarters take heed? *