Will Low Oil Prices End Saudi Arabia’s Gas Subsidies?

19 Sep 2017   Saudi Arabia

Although Saudi Arabia has managed to narrow its budget deficit, the Kingdom continues to feel the fiscal pressure of low oil prices, and is mulling over the phasing out of gasoline subsidies, and making gas prices level with varying international prices, Bloomberg reported on Monday, citing a person familiar with the plan. Under the plan, Saudi Arabia is said to be studying raising gasoline prices by the end of 2017 to bring them to parity with international prices—which would mean a rise of about 80 percent for octane-91 grade gasoline compared to current prices. A decision is expected this month or next, Bloomberg quoted the person with knowledge of the issue as saying. According to Bloomberg’s source, the Saudis are planning a one-time hike of gasoline and jet fuel by the end of this year, while other fuel prices would be gradually increased between 2018 and 2021. The Saudi […]

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