Egypt Delays Rationing Subsidized Fuel to Build Database

Egypt has delayed a plan to ration subsidized gasoline and diesel as it builds a database that will help to implement subsidy cuts, Oil Minister Sherif Haddara said.

The government will soon invite citizens to register online for eligibility to use smart cards to purchase unlimited amounts of subsidized fuel for vehicles or agricultural machines, in a system due to start in July, Haddara told reporters in Cairo today.

Egypt, the Arab world’s most populous nation, is struggling to finance its fuel and food imports after foreign-currency reserves shrank following the 2011 uprising against Hosni Mubarak. Cutting subsidies is central to negotiations with the International Monetary Fund on a $4.8 billion loan. The new rationing system had initially been planned for April.

Haddara said the delay was caused by a “technical reason only” and that the proposed system hasn’t changed. He said the government will collect information such as the quantity of fuel bought by each card-holder and the level of demand at each filling station.

“We first want to know the quantity people consume and what the current consumption pattern is,” Haddara said. “We need a month or two to know the pattern,” after which the government will decide how to ration the subsidized fuel.

Bloomberg