Saudi may lift subsidy on petrol

Saudi Arabia may join the UAE and other Gulf hydrocarbon exporters and lift long-standing subsidies on petrol and this could save nearly SR30 billion (Dh30 billion) a year, according to a newspaper in the world’s dominant oil  exporter.

Saudi Arabia has the second lowest petrol prices in the world after Venezuela because of heavy subsidies and its abundant crude resources but there has been speculation it would end those subsidies, the Arabic language daily 'Al Watan' said.

“Lifting the subsidies on fuel will save Saudi Arabia nearly SR30 billion a year. Economists believe this will also curb soaring consumption levels,” it said.

The paper quoted Fahd Al Anzi, deputy chairman of the economic committee in Shura (appointed parliament), as saying any decision by the government to lift subsidies would push up petrol and diesel prices although global crude prices are currently low.

He said the move could also boost the prices of other items and proposed new government subsidies on some food and other consumer items or the distribution of 'subsidised' fuel supply cards.

“There has been a state of wait-and-see in the Kingdom regarding a decision to join the UAE and other Gulf countries in lifting fuel subsidies,” the paper said.

It said petrol prices in Saudi Arabia are currently the world’s second lowest at $0.16 per litre. It put prices at $0.22 in Kuwait, $0.28 in Bahrain and  $0.62 in the UAE, the second highest fuel price in Asia.

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