Egypt has raised the prices of various fuel products, fulfilling a commitment made over a year ago to the International Monetary Fund (IMF) as part of a $3 billion financial assistance agreement.
In a letter of intent signed in November 2022, Egypt pledged to permit the increase of most fuel prices to align domestic rates more closely with international energy market prices, Reuters reported.
The country also pledged to compensate for the previous year’s slow pace of increases. However, it only raised prices once thereafter, in March 2023.
The IMF agreement lapsed last year due to Egypt’s failure to fulfil commitments, including price hikes and other measures like letting its currency fluctuate with market forces, promptly divesting state assets, and reducing government intervention in the economy.
Price of fuel products
The present increase translates to a rise of 1.00 Egyptian pounds ($0.02) per litre, bringing the prices to 11.00 pounds for 80 octane, 12.50 pounds for 92 octane, and 13.50 pounds for 95 octane.
The pricing committee raised the price of diesel to 10.00 pounds from 8.25 pounds and the price of butane cooking gas to 100 pounds per cylinder from 75 pounds.
The committee also set the price of fuel oil at 7,500 pounds per tonne but left prices unchanged at 1,500 pounds per tonne for food industries and at 2,500 pounds per tonne for power plants.
The IMF has recently expanded its financial support agreement with Egypt to $8 billion to assist the country in navigating economic shocks triggered by the conflict in Gaza.
This decision follows Egypt’s renewed commitment to implementing reform measures, notably a devaluation of its currency. However, it’s important to note that the IMF board has yet to convene and approve the new agreement.
Earlier this month, Egypt devalued its currency by over 35% to open the door for additional loans from the International Monetary Fund.
