Egypt is witnessing a change in fuel prices on Monday

Egypt is witnessing a change in fuel prices on Monday








Editorial date: • 2019/3/30 16:45

{International: Al Furat News} Egypt is looking forward to Monday its first attempt to raise support for the octane 95 fuel category and to liberalize its price to link to world prices, a move observers have described as an initiative to raise subsidies for the rest of the petroleum products.

Earlier this year, the Egyptian government decided to apply the automatic pricing mechanism to benzene octane 95 as of April 1, following a series of measures to lift subsidies on fuel and energy it has taken over the past three years.
"The government will announce on Monday, April 1, the prices of 95 petrol, and there is a technical committee dedicated to this matter and review its prices every three months," the spokesman of the Ministry of Petroleum Hamdi Abdul Aziz told Sputnik.
"The rate of change in price is either an increase or a decrease of only 10 percent from the current price," Abdel Aziz said. "When the new prices are introduced, we will see the size of the increase or decrease in price, which could increase by 2 percent or 3 percent. The price drops by the same percentage. "
Benzene octane 95 accounts for about 4 percent of Egypt's gasoline consumption.
Egypt raised the price of a liter of gasoline octane 95 from 6.60 pint / liter in the middle of last year, to the current price of 7.75 pint / liter, equivalent to less than half a dollar, while still provide partial support for petrol 92 and diesel.
"The price will be linked to the price of Brent crude in the global market, as well as the exchange rate [exchange rate of the pound against the dollar and foreign currencies] and trading costs."
The ministry spokesman said that "the volume of increase and decrease in consumption rates can not be known until at least one month after the application of the new prices." The government will announce Monday the price of 95 gas for the next three months.
In January, Prime Minister Mustapha Medbouli formed a technical committee to follow up the automatic pricing mechanism for petroleum products, including representatives of the Ministry of Petroleum, the Ministry of Finance and the General Petroleum Corporation.
Article 2 of the Prime Minister's Decision stipulates that "the automatic pricing mechanism on benzene octane 95 shall be applied to the delivery of the consumer, including VAT, from the end of December 2018, while maintaining the selling price of the current consumer, This product as mentioned above in the previous decision item, provided that the rate of change in the selling price of the consumer does not exceed or exceed 10% of the current selling price.
For his part, said the international oil expert Dr. Ibrahim Zahran, "95 petrol prices in Egypt more expensive than its price on the international stock exchange, if the decision will be applied to reduce the price we welcome," followed "95 consumption of gasoline in Egypt is very weak and not required, Its price is a factor affecting the market as a whole. "
"95 percent of consumers in Egypt do not represent a large segment of the consumption of petroleum products, 4 percent is very weak," Zahran said.
On the possibility of repeating this decision on all petroleum products in the early next fiscal year by the end of June, Zahran said, "There is no less than 95 petrol in the international bourse, that is, there are no benzene 92 and 80 these are local materials manufactured inside the country. To which international prices apply, and therefore raising subsidies will increase prices internally. "
Egypt's fifth tranche of the International Monetary Fund (IMF) loan was postponed from December to January, after the Egyptian government asked the IMF to postpone the implementation of some agreed measures with the IMF to liberalize the price of fuel.
Egypt began implementing an agreement with the International Monetary Fund (IMF) at the end of 2016, under which it will receive a $ 12 billion loan and implement a package of economic policies, including liberalization of the exchange rate, abolition of subsidies on fuel and the application of value added tax. is over


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