The Egyptian Minister of Petroleum and Mineral Resources, Tarek El Molla, stated that the cost of fuel subsidy will increase to EGP 64b during fiscal year 2016/2017 after the current devaluation, reported Al Mal News.

El Molla stated that the subsidy budget for 2016/2017 was estimated to be EGP 35b based on expected exchange rate for USD at EGP 9, and Brent per barrel price of $40. However, devalued pound and the fact that Brent price is higher than the estimated, the cost of oil and gas subsidies  will grow to reach about EGP 64b, a 83% increase for this fiscal year. Accordingly, the ministry decided to increase fuel selling prices by a range of 30% to 47%, in order to boost the ministry’s income by EGP 15b.

The fuel subsidy cost had decreased during 2015/2016 from EGP 71.5b in 2014/2015 to EGP 51b.

In related News, Egypt Oil&Gas reported that the Egyptian Ministry of Petroleum had increased petrol price early November in a move to alleviate fuel subsidy expenditure within the country’s economic reform program. The government had implemented the new prices upon announcing the change.