New Delhi. Tension in the Middle East has thrown Pakistan’s economy into crisis and caused inflation to reach its highest level in 74 weeks. This information was given in a report. The surge in global energy prices has pushed the country’s inflation back into double digits, leading to a 12.15 per cent year-on-year rise in the Sensitive Price Indicator (SPI), a 74-week high, Pakistan newspaper ‘The Express Tribune’ reported. According to analysts at Topline Securities, the recent surge reflects the severity of the current crisis.
The surge in inflation in Pakistan follows a period of stability in late 2025, when SPI inflation declined to 2.4 per cent in early January 2026 due to favorable base effects.
However, the situation has deteriorated rapidly since the start of the US-Iran war, and inflation has seen a sharp jump from the levels of around 4-5 per cent recorded in February this year.
The main reason for this sudden increase is the instability in global energy markets due to geopolitical tensions in the Middle East.
The supply disruptions led to a sharp spike in international oil prices, the impact of which was immediately visible on Pakistan’s domestic economy, where fuel costs largely influence overall inflation.
There has been a huge increase in fuel prices in the last one year, with diesel price increasing by 101.02 per cent, petrol price increasing by 48.70 per cent and LPG price increasing by 65.86 per cent annually.
This rapid growth has led to increased transportation and logistics costs, leading to a sharp rise in prices of essential commodities.
The energy crisis has also increased food inflation, putting additional pressure on the household budget.
There has been a strong rise in prices of major food items, with onion becoming costlier by 37.80 per cent, wheat flour by 30.10 per cent and tomato by 23.07 per cent compared to last year.
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