Egypt's cost of subsidized petroleum products rose 68 percent to 23.5 billion Egyptian pounds ($1.33 billion) in the first quarter of fiscal year 2017-2018 from a year earlier, Energy Minister Tariq al-Mulla told reporters on Saturday. Fuel subsidies reached 14 billion pounds in the first quarter of the previous fiscal year 2016-2017.
Egypt is carrying out a broad economic reform programme under a three-year, $12 billion International Monetary Fund loan programme, including a floatation of the pound currency a year ago and a phasing out of many of its state subsidies. The minister said the government would eventually seek to end gasoline subsidies and partially maintain the subsidy on natural gas, but gave no date for those measures.
"There will be no increase in prices of petroleum products during the current fiscal year," he said. Egypt in June hiked fuel prices by up to 50 percent as part of its IMF loan deal, a sharper rise than expected by many Egyptians. Officials say reforms help revive an economy where subsidies accounted for about a quarter of state spending.
The minister also said Egypt is negotiating with Iraq to increase the volume of crude oil imports to 2 million barrels per month from the current 1 million barrels per month. Egypt reached a deal with Iraq in April for 12 million barrels of oil imports a year. Abed Ezz, the chief executive of the Egyptian General Petroleum Authority, had said in September Egypt would renew the contract with Iraq for the same amount.