Egypt plans to remove fuel subsidies in 2019: Oil Minister

Egypt plans to remove fuel subsidies next year, Oil Minister Tarek el-Molla said on Wednesday.

Cutting subsidies to reduce pressure on government spending is one of the country’s main goals as it pushes forward with reforms to revive an economy that has struggled since a 2011 uprising. It is also a condition of a $12 billion deal Egypt signed with the International Monetary Fund in 2016.

Egypt’s Ministry of Oil announced earlier this week steep increases in fuel and cooking gas prices by up to 50 percent under the IMF reform plan calling for austerity measures that have made life tougher for ordinary Egyptians.

The price rises, the third since Egypt floated the pound currency in November 2016, would help Egypt save up to 50 billion Egyptian pounds ($2.8 billion) in allocations for state subsidies in the 2018-19 state budget.

The price for 95 octane gasoline had been increased to 7.75 Egyptian pounds a liter from 6.60 pounds; 92 octane had been raised to 6.75 pounds a liter from 5 pounds and 80 octane had gone up to 5.50 pounds a liter from 3.65 pounds.

The price for a canister of gas for Egyptian households also raised to 50 pounds from 30, while a bottle of gas for commercial purposes was raised to 100 pounds from 60.

“The recent price rises have helped the government restore around 75 percent of cut subsidies on fuel,” Minister el-Molla said in a press conference.