Egypt diesel subsidy costs $3bn annually, says PM

Egypt's Prime Minister Mostafa Madbouly in Shanghai on 5 November 2018 [ALY SONG/AFP/Getty Images]

Egypt spends approximately 55 billion Egyptian pounds per year ($2.92 billion) on diesel subsidies, Prime Minister Mostafa Madbouly announced yesterday.

Egypt raised the price of diesel on Wednesday by 0.50 pounds to 7.25 pounds per litre following two previous increases in 2021.

Since 2019, Egyptian fuel prices have been set within a framework of quarterly reviews that take into account global markets, as well as the foreign exchange rates after Cairo phased out subsidies on most fuel products as part of a reform programme agreed with the International Monetary Fund.

Diesel is widely used across Egypt's transport system and in agriculture. Madbouly was reported recently to be "coordinating with governors on ensuring that transport companies do not inappropriately increase their prices" as a result of the petrol price hikes.

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