Cairo March 2 2023: Egypt raised gasoline prices by around 10%, as the government looks to cut subsidies and ease a foreign-exchange crisis that’s forced it to turn to the International Monetary Fund and Gulf states for funding.
Even with the widely expected increase, Egypt will remain one of the cheapest places in the world for drivers to fill up their tanks. Still, it’s a further blow to millions of cash-strapped Egyptians suffering from inflation of 26%.
The Oil Ministry raised the price of Octane 80 gasoline — the cheapest type — to 8.75 Egyptian pounds (29 US cents) a liter from 8 pounds. Other varieties will climb by a similar amount, while diesel was kept unchanged at 7.25 pounds a liter.
Gasoline costs 98 cents a liter on average in the US and around $2 in many Western European countries, according to globalpetrolprices.com.
Egypt’s $400 billion economy plunged into crisis when Russia’s invasion of Ukraine last year triggered a surge in the cost of wheat and fuel imports.
Brent crude averaged almost $100 a barrel in 2022, the highest level in eight years.
Authorities have devalued the pound three times in the past year, allowing it to lose almost half its value against the dollar.
The IMF approved a $3 billion loan for Egypt in December, with the full disbursement conditional on reforms. The deal stipulates that the government should continue to move fuel prices broadly in line with changes in global oil prices.
The first review of the IMF program is expected to be completed this month.
