Egypt took a significant step today by increasing the prices of several fuel products in line with its commitment to the International Monetary Fund (IMF). This decision is part of a $3bn financial agreement established a year ago.
The pledge in November 2022 aimed to align domestic fuel prices more closely with international energy market rates. Despite a previous lack of action, Egypt now strives to fulfill this promise.
As reported by Reuters, the quarterly pricing committee, as stated by the petroleum ministry, raised petrol prices. This includes increments of 1.00 Egyptian pound ($0.02) per litre for various octane levels, with 80 octane reaching 11.00 pounds, 92 octane at 12.50 pounds, and 95 octane at 13.50 pounds.
Diesel prices were also adjusted, rising to 10.00 pounds from 8.25 pounds. There was also an increase in the price of butane cooking gas to 100 pounds per cylinder from 75 pounds. Fuel oil was set at 7,500 pounds per tonne, with unchanged prices for specific industries and power plants.
The IMF has argued that subsidized petrol prices primarily benefit the wealthy, to the detriment of the poorer segments of society. Consequently, Egypt’s recent actions align with the IMF’s recommendations.
To support Egypt’s economy amidst challenges such as the War in Gaza and currency devaluation, the IMF extended its financial support to $8bn. This move follows Egypt’s renewed commitment to reform measures.
Despite these efforts, Egypt continues to face economic challenges, with approximately 60% of its 106 million citizens estimated to be below or near the poverty line. To mitigate these issues, Egypt has received aid and stimulus packages from various entities, including the European Union, the World Bank, and the UAE.
