What will happen regarding the prices of gasoline, diesel, gas and butane in the coming days, and what is the big surprise that the Petroleum Pricing Committee has prepared for the citizens? Come and see what the story is in this video. Stay with us until the end.
All of Egypt is waiting for the decision of the Petroleum Pricing Committee, which meets every 3 months to review prices and announce them to citizens. Although Egyptians are very busy with the power outage crisis these days as part of the load shedding policy due to the unprecedented high temperatures and the high school exams, people are still focused on the news of the Gasoline and Diesel Pricing Committee because it has been said a lot that there is a trend to raise the prices of petroleum products, and this will have negative effects on the prices of most goods and services because the citizen is the one who bears the burden of increasing the cost of producing goods and transportation in the end.
So, what are the scenarios for the Petroleum Products Pricing Committee’s decision in the coming hours or days?
Look, sir, before any meeting of the Pricing Committee, the Egyptian General Petroleum Corporation will submit a detailed report to the committee that includes the global Brent crude oil price curve during the second quarter of this year to determine the most likely scenario for implementation regarding fuel sales tariffs in Egypt during the first quarter of the fiscal year 2024-2025.
According to information, the Fuel Pricing Committee is currently studying a number of proposals and scenarios that were prepared by representatives of the Egyptian Ministry of Petroleum and some concerned authorities during the current June. The first scenario is to move the prices of gasoline and butane cylinders, and to stabilize diesel prices to protect the middle and low-income group and to prevent moving the prices of the rest of the consumer sectors and transportation tariffs. And shipping in Egypt… I mean, the committee is considering increasing the prices of gasoline and gasoline and fixing diesel fuel, because the means of transport do not know the price, and in order to support farmers who use diesel fuel for irrigation.
The team that leaned towards this scenario believes that the government must bear additional support in the new fiscal year at a rate of 22.7% over the current fiscal year, and this means that part of the financial allocations to provide fuel in the market will be borne by the state’s consumer sectors, whether citizens or commercial and industrial consumers, so that the committee can fix the price of diesel.
The sources said that the reports that will be presented to the pricing committee at the meeting to determine fuel prices will include a presentation of the current actual cost of petroleum products in Egypt, which has increased in the recent period as a result of internal and external variables affecting the price of fuel, whether due to movements in the exchange rate of the dollar against the pound or the cost of transportation and shipping from Abroad, these factors will certainly affect the selling price of fuel, which the government is still subsidizing.
As for the second scenario, which is also strongly proposed, which is to delay the decision of the Petroleum Products Pricing Committee until after next July, and work will continue at the current prices. This is due to the coincidence of the meeting of the Fuel Committee with economic crises and power outages, in contrast to the Egyptian government’s tendency to increase electricity prices starting in July, and therefore the government is possible. It resorts to the scenario of delaying the movement of fuel tariffs, taking into account the social dimension of citizens.
I am left with the third scenario, which is unlikely due to the difficulty of implementing it, but everything that is possible is that the Fuel Pricing Committee will resort to reducing the prices of gasoline, diesel, and gas, or reducing any type of them, and stabilizing the rest. We say that this scenario is difficult because it will burden the state with large sums, at a time when it imports 25% of its fuel needs. Through import from abroad and in dollars, of course.
We keep you in mind that the Ministry of Petroleum takes into account global markets and the exchange rate, which is closely linked to Brent crude prices, and the Petroleum Authority report revealed that global oil prices are trading at a level of approximately $85 per barrel, meaning a difference of $3 higher than the price estimated per barrel in the next fiscal year’s budget, and this is likely. Fuel price increase scenario.