What does the month of April hold for fuel prices in Egypt?

News Arabia" The government is obliged to raise the prices of petroleum products by applying the minimum price equation, which is 10% over more than a quarterly basis until they reach the cost price.

The committee to define and follow up the automatic pricing mechanism for petroleum products meets every 3 months to determine the prices of petroleum products, provided that the percentage change in the consumer selling price does not exceed 10%, up or down from the current selling price.

Expectations indicate that the automatic pricing committee will meet before the end of March to determine its decision on the new prices for gasoline and diesel that will be applied from April to June.

The committee takes into account factors that it studies before making its decision, most notably oil prices Global, production, operating and transportation costs, exchange rate pound Against the dollar, and other factors.

And for the prices oilOil futures fell, as Brent fell 1.6 percent to $113.75 a barrel by 03:15 GMT, and US crude fell by 1.8 percent to $110.11.

The Egyptian pound also fell to about 18.50 to the dollar on Tuesday morning from 18.27, a day after the country devalued the local currency by 14 percent.

government reservation

According to the former head of the Egyptian Petroleum Authority, the government can decide a rate higher than 10% if oil prices globally and the dollar locally get out of control.

However, he suggested that the government would be extremely conservative in raising the price of diesel, as it immediately affects the citizen and inflation rates, pointing out that the price of diesel globally exceeds 16.5 pounds per liter, while it is sold in the Egyptian market at 6.75 pounds.

The industry was also affected by the price of the dollar, as the price of natural gas increased by 2.5 pounds per million units, which is the fuel on which the industry relies heavily, especially since the government sells it to factories in dollars, but receives it at the new dollar exchange rate.

A report by Prime Securities Company stated that the rise in oil prices will push the automatic fuel pricing committee in Egypt to increase prices.

and lowered EgyptOn Monday, the value of the currency increased from 15.7 to the dollar, a level at which it has remained almost stable for most of the time since November 2017.

The latest devaluation has pushed the pound down by more than 15 percent since Monday morning, and the Cabinet said in a statement that it plans to restructure the general budget for the 2022-2023 fiscal year to overcome the repercussions of the global crisis resulting from the Ukraine war.

And last month, with the rise in oil prices, the government raised gasoline prices by 25 piasters per liter, to currently reach 7.25 pounds per liter of gasoline 80, 8.50 pounds per liter of gasoline 92, and 9.50 pounds per liter of gasoline 95, and fixing the price of diesel at 6.75 pounds per liter.

Egypt imports 25-30% of its needs of gasoline and diesel (worth $5.3 billion in 2021), and with the increases in crude prices, the prices of oil derivatives have exploded accordingly, and the price of the dollar will rise, which will raise the import bill; This will, in turn, affect the cost of providing derivatives locally, and affect the decisions of the Fuel Pricing Committee in the coming period.

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According to the expectations of Engineer Medhat Youssef, former head of the Egyptian Petroleum Authority, “Egyptians are preparing to receive the new prices for gasoline and diesel at the beginning of April.”

Youssef added to “Sky News Arabia” that the government is obliged to raise the prices of petroleum products by applying the minimum price equation, which is 10% over more than a quarter to reach the cost price.

The committee to define and follow up the automatic pricing mechanism for petroleum products meets every 3 months to determine the prices of petroleum products, provided that the percentage change in the consumer selling price does not exceed 10%, up or down from the current selling price.

Expectations indicate that the automatic pricing committee will meet before the end of March to determine its decision on the new prices for gasoline and diesel that will be applied from April to June.

The committee takes into account factors that it studies before making its decision, most notably oil prices Global, production, operating and transportation costs, exchange rate pound Against the dollar, and other factors.

And for the prices oilOil futures fell, as Brent fell 1.6 percent to $113.75 a barrel by 03:15 GMT, and US crude fell by 1.8 percent to $110.11.

The Egyptian pound also fell to about 18.50 to the dollar on Tuesday morning from 18.27, a day after the country devalued the local currency by 14 percent.

government reservation

According to the former head of the Egyptian Petroleum Authority, the government can decide a rate higher than 10% if oil prices globally and the dollar locally get out of control.

However, he suggested that the government would be extremely conservative in raising the price of diesel, as it immediately affects the citizen and inflation rates, pointing out that the price of diesel globally exceeds 16.5 pounds per liter, while it is sold in the Egyptian market at 6.75 pounds.

The industry was also affected by the price of the dollar, as the price of natural gas increased by 2.5 pounds per million units, which is the fuel on which the industry relies heavily, especially since the government sells it to factories in dollars, but receives it at the new dollar exchange rate.

A report by Prime Securities Company stated that the rise in oil prices will push the automatic fuel pricing committee in Egypt to increase prices.

and lowered EgyptOn Monday, the value of the currency increased from 15.7 to the dollar, a level at which it has remained almost stable for most of the time since November 2017.

The latest devaluation has pushed the pound down by more than 15 percent since Monday morning, and the Cabinet said in a statement that it plans to restructure the general budget for the 2022-2023 fiscal year to overcome the repercussions of the global crisis resulting from the Ukraine war.

And last month, with the rise in oil prices, the government raised gasoline prices by 25 piasters per liter, to currently reach 7.25 pounds per liter of gasoline 80, 8.50 pounds per liter of gasoline 92, and 9.50 pounds per liter of gasoline 95, and fixing the price of diesel at 6.75 pounds per liter.

Egypt imports 25-30% of its needs of gasoline and diesel (worth $5.3 billion in 2021), and with the increases in crude prices, the prices of oil derivatives have exploded accordingly, and the price of the dollar will rise, which will raise the import bill; This will, in turn, affect the cost of providing derivatives locally, and affect the decisions of the Fuel Pricing Committee in the coming period.

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