Pakistan has extended its nationwide austerity and fuel conservation measures until June 13 as uncertainty surrounding the Middle East conflict continues to pressure global oil markets and regional economies. The decision came after Prime Minister Shehbaz Sharif approved recommendations from the implementation committee, aiming to control government spending and reduce fuel consumption during a fragile economic period.
According to an official notification issued by the Cabinet Division, the government will continue enforcing a 50% cut in fuel supply for official vehicles throughout the extended period. In addition, authorities will keep nearly 60% of official vehicles off the roads to lower fuel usage and ease pressure created by unstable international oil supplies linked to the ongoing US-Iran standoff.
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The austerity campaign was originally launched on March 9 after the government increased petrol and diesel prices by 20% following severe disruptions in global oil shipments. Fuel prices surged sharply after Strait of Hormuz faced blockades during the conflict involving Iran, United States and Israel, creating serious concerns for energy-importing countries across the region, including Pakistan.
Although a ceasefire was reached on April 8 through diplomatic efforts supported by Pakistan, negotiations between Washington and Tehran remain deadlocked over proposals aimed at permanently ending the regional conflict. Officials believe the continued uncertainty surrounding the Strait of Hormuz could further impact oil prices and transportation costs, forcing governments like Pakistan to maintain strict financial discipline and fuel-saving policies for a longer duration.
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The austerity measures apply broadly across federal institutions, including ministries, autonomous bodies, state-owned enterprises, defence organisations, parliament and the judiciary. Furthermore, government departments must continue reducing non-essential spending by 20% during the final quarter of the current fiscal year, while restrictions on foreign visits for ministers and officials also remain active except for mandatory diplomatic or official engagements.
The government has additionally maintained work-from-home policies for up to 50% of employees on alternate days, excluding essential services and the banking sector from these restrictions. Officials are also required to travel in economy class and hold virtual meetings whenever possible, as authorities attempt to reduce unnecessary expenditures while preparing for possible economic challenges linked to prolonged regional instability and global energy uncertainty.