Naveed Yousafzai
There is a particular cruelty in how great power rivalries play out in countries like Pakistan. While Washington and Tehran posture over influence and deterrence, is the daily wage worker in Lahore or the small shopkeeper in Rawalpindi who ultimately absorbs the shock. The escalating tensions between Iran and the United States are no longer merely a foreign policy headline — they have arrived at Pakistan’s doorstep in the form of rising fuel prices, accelerating inflation, and a creeping paralysis of ordinary economic life.
The Fuel Chain Reaction
Pakistan imports the vast majority of its petroleum needs, which means it has almost no buffer against global oil price volatility. When Iran-US tensions flare, regional energy markets respond with anxiety, and that anxiety translates directly into higher petrol prices at home. What policymakers sometimes fail — or refuse — to communicate clearly is that a fuel price increase is never a standalone event. It is the first domino. Transportation costs rise, then food prices follow, then the cost of manufacturing, then retail. The entire supply chain reprices itself upward, and by the time the impact reaches a household buying bread or cooking oil, it has compounded several times over.
This is the wave that is now building across Pakistan’s economy, and it is hitting a population that was already struggling. Inflation had not been tamed. Household budgets were already stretched thin. The Iran-US crisis has not created Pakistan’s economic vulnerability — it has simply exposed how deep and how dangerous it already was.
The Lockdown Paradox
Compounding the fuel crisis are partial lockdown measures and enforced weekly shutdowns that have been implemented across parts of the country. The stated rationale may be administrative or precautionary, but the economic consequence is unambiguous: reduced business hours mean reduced income, and for daily wage earners, a lost workday is not an inconvenience — it is a lost meal.
Pakistan Peoples Party Punjab leader Syeda Samira Raza has pointedly criticized this contradiction. Shutdowns, she argues, are disrupting not only commerce but education, while no meaningful relief has been announced to offset the damage inflicted on the poor and the middle class. Her words carry weight not because they are politically convenient, but because they are factually grounded. You cannot restrict people’s ability to earn and simultaneously ignore their ability to survive. That is not policy — it is pressure without purpose.
Who Bears the Burden?
The bitter arithmetic of this crisis is straightforward. Large corporations can absorb a spike in fuel costs and pass it down the supply chain. The wealthy can absorb inflation because their margins are wider. It is the small business owner, the street vendor, the factory worker paid by the day, who has no such cushion. For them, the convergence of external geopolitical shocks, domestic fuel price hikes, and restrictive lockdown policies is not a passing inconvenience — it is an existential squeeze.
Pakistan’s economic structure makes this problem structurally recursive. Higher fuel costs raise transportation prices. Higher transportation prices raise food prices. Higher food prices consume a greater share of low-income household budgets. That leaves less spending for everything else, contracting local demand, slowing business, and ultimately feeding back into unemployment and further hardship. This is not speculation — it is the documented pattern that has played out in Pakistan during every major oil price shock in recent memory.
What the Government Must Do — Now
The political and economic establishment cannot afford to treat this moment as business as usual. Several urgent steps are not merely advisable — they are necessary.
First, petroleum prices must be reviewed immediately, with targeted subsidies protecting the most vulnerable segments of the population from the full brunt of global price fluctuations. This does not require a blanket, fiscally irresponsible fuel subsidy — it requires a targeted, data-driven intervention.
Second, any lockdown or shutdown policy must come bundled with compensatory relief for daily wage workers and small business owners. Restrictions without relief are not governance — they are abandonment.
Third, the government must engage proactively with international financial institutions and bilateral partners to build a short-term buffer against the economic turbulence radiating from the Iran-US standoff. Diplomatic agility matters as much as domestic fiscal policy in moments like this.
The Larger Warning
Pakistan sits at a difficult intersection: a fragile macroeconomic recovery, a population with limited tolerance for further hardship, and a geopolitical environment it cannot control. The Iran-US tensions may ease, or they may escalate further. Either way, Pakistan cannot afford to simply react. A country that perpetually absorbs global shocks without building structural resilience is a country condemned to repeat this cycle indefinitely.
The public patience that governments often take for granted is not infinite. Economic stress, when prolonged and perceived as indifferently managed, has political consequences. The citizens currently bearing the weight of fuel hikes, rising food prices, and lost workdays are not abstractions in a policy document — they are voters, workers, parents, and people already operating at the edge of their endurance.
The government’s response in the coming weeks will signal whether it grasps the severity of what is unfolding — or whether it will, once again, wait until the crisis deepens to act.
