Kuwait has approved an increase in prices of gasoline sold locally by 42% to 83% depending on the grade in an attempt to align local rates with GCC averages, Bloomberg reports. The price increase will start as of September.

The price hike for the lowest octane gasoline will amount to 42%, while the highest grade of fuel will see a price increase of 83%. As a result, this will bring the prices to 85 fils per liter and 165 fils per liter, respectively. Octane-91 will be sold for 85 fils per liter up from 60, Octane-95 will be sold for 105 fils from the current 65 and the Ultra-Premium will be sold for 165 fils instead of today’s 95 fils per liter.

The Kuwaiti cabinet said that a government committee will revise the new petrol prices every three months depending on international oil prices.

Accordingly to AlBawaba, the Kuwaiti government approved to remove subsidy on gasoline, in a step that aims at rationalizing expenses to cope with fiscal difficulties resulting from the decline in oil revenues. Following the adoption of austerity measures, Kuwait plans to raise as much as $9.9b internationally and $6.6b locally.

The plunge in oil prices has prompted members of the six-nation Gulf Cooperation Council (GCC) to revise the generous benefits their citizens traditionally enjoyed, and forced them to tap the international bond market to plug their deficits.