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UAE to Cut $7b Gasoline Subsidies

UAE to Cut $7b Gasoline SubsidiesUAE to Cut $7b Gasoline Subsidies

The United Arab Emirates is to end gasoline subsidies from August 1, in a move that will save $7 billion a year for the Persian Gulf state and curb car usage.

The UAE, like many other countries in the Middle East, subsidizes a range of commodities. These subsidies have meant many commodities like food and fuel in many countries of the region are much cheaper than market rates, and this has led to overconsumption and waste, Arabianbusiness reported.

Motorists discovered on Tuesday that they will have to pay on average of 20 percent more for gasoline in the UAE following a decision to deregulate gasoline and diesel prices, and create a new pricing policy linked to global levels.

Prior to the change, retail prices ranged between AED1.61 per liter for Gasoline E Plus and AED1.83 per liter for Unleaded Gasoline 98, with Unleaded Gasoline 95 costing AED1.72 per liter.

The price of diesel, on the other hand, has fallen as it currently retails at AED2.90 in Dubai and the northern emirates, including Sharjah, Ajman, Umm Al Quwain, Ras Al Khaimah and Fujairah. The current price of diesel in Abu Dhabi is AED2.35.

The prices were announced by the UAE’s new Gasoline and Diesel Prices Committee that revealed its first monthly fuel prices for August.

The UAE announced last week that gasoline and diesel will be deregulated from August 1 and a new pricing policy linked to global levels will be introduced.

caption: Motorists will have to pay on average of 20 percent more for gasoline.

Financialtribune.com