Islamabad—President Pakistan Businessmen and Intellectuals Forum (PBIF) Mian Zahid Hussain on Monday said expected rise in oil prices should be taken seriously as it will damage economy. Oil prices remained subdued for three years but now OPEC has joined hands after 2008 to increase prices, which is a bad news for all the oil importing countries including Pakistan, he said.
Hussain said that oil prices have helped Pakistan to save seven billion dollars but it hasn’t helped country to boost exports, investment or substantially reduce trade deficit. He said that now OPEC has agreed to cut production by seven hundred thousand barrels per day which has resulted in five percent hike in international oil prices while second meeting of the cartel is scheduled next month which may trigger massive price hike.
In such a scenario, cost of doing business will climb, hitting production and exports, increase inflation and may eat up the forex reserves, he warned. He said that increased oil prices will not only hit foreign exchange reserves but also erode our debt repayment capacity at a time country is exiting the IMF programme therefore policymakers should take notice of the situation and take necessary steps immediately.