Government raises gasoline prices for the fifth time in a row

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The Ministry of Petroleum and Mineral Resources in Egypt has announced an increase in gasoline prices of all kinds by 25 piasters per litre during the next three months.

The new prices include raising the price of a litre of 80-octane gasoline to EGP 7.50, an increase of 3.4%, raising the price of a litre of 92-octane gasoline to EGP 8.75, an increase of 2.9%, and raising the price of a litre of 95-octane gasoline to EGP 9.75, an increase of 2.6%.

The decision also included an increase in the price of a ton of diesel by 400 pounds, to reach 4,600 pounds, an increase of 9.5%. This increase is the fifth in a row implemented by the government. The government had implemented several consecutive increases in gasoline prices during April, July, and October of 2021. Thus, a litre of gasoline 80 came for 7 pounds, a litre of gasoline 92 for 8.25 pounds, a litre of gasoline 95 for 9.25 pounds, and a litre of diesel at 6.75 pounds.

The latest increase was the eighth since President Abdel Fattah al-Sisi took office in 2014. The price of a litre of Octane 80 increased from 0.8 to 7 pounds per litre, an increase of more than 740%, and Octane 92 increased from 1.85 to 8.25 pounds, an increase of more than 330%. In 2019, the government began applying an automatic pricing mechanism to several petroleum products after liberalizing their prices within a program to eliminate subsidies for these products gradually. The price equation states that gasoline prices are adjusted every three months, not exceeding 10% of the selling price in the local market, based on three main factors: the global price of a barrel of oil, the Egyptian pound exchange rate against the US dollar, and the amount of change in cost components.

The Egyptian authorities had imposed a tax on petroleum products to fix the selling price locally in the decline in international fuel prices. Petroleum subsidies in Egypt’s general budget have declined by more than 87% during the past four fiscal years. In the budget for the fiscal year 2021-2022, subsidies for petroleum products decreased from 28.19 billion pounds to 18.41 billion pounds, a reduction of 35%, while it amounted to 145 billion pounds in the 2017-2018 budget.