Carbon-negative Bhutan has aggressively promoted hydropower projects, earning substantial revenue by exporting electricity to energy-hungry neighbour India.

But the landlocked nation of about 800,000 people imports its fuel via India, and shortages of fuel have sparked long queues at filling stations in the capital Thimphu, AFP reporters saw Thursday.

"I don't know what to say. It's not like our government is responsible, they are trying their best despite the war in the Middle East and price hike in India," said Karma Kalden, 40, a resident of Thimphu. "We are helpless," she added.

The government issued the latest rise in fuel price late on Wednesday, when it also issued energy saving measures.

"There has been a substantial increase in global fuel prices in recent weeks," the prime minister's office said in a statement.

It added that the rise in fuel costs are "driven by external conditions beyond our control".

Bhutan, squeezed between giants India and China, introduced a government fuel subsidy on March 21 to "cushion the effect on households and the economy".

The price of petrol at the pump has shot up by more than 60 percent since war began in the Middle East on February 28, even with government subsidies.

It has risen from around 65-95 ngultrum since February, up to the new government subsidised set price on April 1 ($0.69-$1.04 a litre).

The government has appealed for the public to help as fuel prices surge.

"Given the significant burden on the national exchequer, all public service agencies are directed to put in place measures to reduce fuel consumption, such as walking to work, avoiding non-essential travel and working remotely," the government added.