The government will ask parliament to allocate LE108.9 billion or more in subsidies for petroleum products in the budget for the new fiscal year 2012-2013, Minister of Petroleum Abdallah Ghorab has said.
The allocation is intended to cater for the annual increase in consumption and the rise in the prices of petroleum product imports.
Ghorab told Al-Masry Al-Youm that the General Petroleum Authority has conducted comprehensive studies to determine its financial needs for the new fiscal year. Subsidies for petroleum products increased exponentially over 10 years from LE10.3 billion in 2001/2002 to LE95.5 billion in 2010/2011.
He said the increase is attributed to the fact that the selling prices of most petroleum products have remained fixed in the local market, while local consumption has been increasing and so have the international prices of crude oil and petroleum products. He also said the direct expenses of producing and distributing the products have climbed.
It is predicted that the subsidy will be increased to LE113.2 billion by the end of June, and that the price of petroleum will increase.
Edited translation from Al-Masry Al-Youm
