The federal government on Monday increased the price of high-speed diesel (HSD) by Rs 5.71 per litre while reducing the price of petrol by 35 paisas per litre for July 21.

According to a notification issued by the Ministry of Petroleum, the price of petrol has been fixed at Rs 315.8 per litre, while HSD will now cost Rs 360.06 per litre.

Amid volatility in global oil rates on the back of renewed hostilities in the Middle East, the government decided to switch to a daily fuel price review mechanism on Friday. The daily pricing is based on a seven-day weekly average of international market prices to align with international standards.

The Oil and Gas Regulatory Authority will update petroleum product prices daily on its website to ensure transparency and allow the immediate impact of international price fluctuations to be passed on to consumers.

Officials said international oil prices had surged again following the renewed conflict between Iran and the United States and concerns over the closure of the Strait of Hormuz, threatening global oil supplies, including those to Pakistan.

Domestic fuel prices had initially declined following the Iran-US peace deal but started rising again after fresh hostilities resumed.

The renewed conflict has also raised concerns over potential fuel shortages in the country.

High-speed diesel is widely used in the transport and agriculture sectors, while petrol is primarily consumed by motorcycles and cars. Officials said petrol demand has increased following restrictions on the use of indigenous gas in Punjab.