Hormuz Conflict Sends Energy Costs Soaring for South Asian Countries

The conflict in the Strait of Hormuz has significantly increased energy costs for South Asian countries, including Pakistan, India, and Bangladesh. According to official trade data, Pakistan's petroleum import bill surged from around $983 million in March to $1.28 billion in July, with a cumulative increase of nearly $1.3 billion or 20% over the four-month period.

The sharpest rise came in April, when the petroleum import bill jumped to approximately $1.79 billion, followed by an elevated rate in May and a record-high of almost $1.91 billion in June. The pressure eased slightly in July, but the cumulative March-July bill remained significantly higher than the previous year.

The disruption has not only increased crude and LNG prices but also freight, marine insurance, and security costs, raising the landed cost of energy cargoes. Pakistan's petroleum-group imports during March-July 2026 totaled around $7.7-$7.9 billion, compared to about $6.6 billion in the corresponding period of 2025.