Pakistan, July 14 -- Petroleum Minister Ali Pervaiz Malik's assertion that petrol remains cheaper in Pakistan than in many other countries may be correct on a simple currency-conversion basis. However, it is also an incomplete measure of what fuel costs an economy and its citizens. After the latest increase, petrol stands at Rs 310.71 per litre and high-speed diesel at Rs 323.30 per litre.

The relevant test is not where these prices sit in an international table, but how they compare with domestic incomes, and the capacity to absorb another shock.

A litre priced higher in a wealthy economy may consume a much smaller share of a worker's earnings. Many such countries also provide reliable public transport and impose high fuel taxes as an ...