Egypt Increases Fuel Prices Ahead of IMF Loan Review

Egypt has raised fuel prices by up to 15%, just days before an IMF review of its expanded $8 billion loan programme. The increases are part of an agreement to slash fuel subsidies. Egyptians fear higher costs for daily goods, and more price hikes are expected through 2025.

Egypt has announced an increase in fuel prices across a wide range of products, just four days before the International Monetary Fund (IMF) is set to conduct a third review of the country's $8 billion loan programme, according to the official gazette.

The petroleum ministry revealed that petrol prices have surged by up to 15% per litre. Specifically, 80 octane now costs 12.25 Egyptian pounds ($0.25), 92 octane is priced at 13.75 pounds, and 95 octane has risen to 15 pounds. Diesel, a commonly used fuel, saw its price increase to 11.50 Egyptian pounds ($0.24) from 10 pounds.

This hike marks the second price increase since the IMF expanded its loan programme by $5 billion in March. Under the agreement, Egypt committed to reducing fuel subsidies. Citizens voiced concerns about the increases causing a rise in the cost of daily goods. Taxi driver Sayed Abdo commented, "If you ride with me today and usually pay 10 Egyptian pounds, I will ask you for 15, because fuel prices are raised."

Prime Minister Mostafa Madbouly stated that fuel prices will continue to rise gradually until the end of 2025, adding that the government could no longer sustain the burden of increasing consumption. Recently, Egypt also faced power outages due to difficulties in importing sufficient natural gas during the summer heat.

In April, the IMF projected that Egypt would spend 331 billion Egyptian pounds ($6.85 billion) on fuel subsidies for the fiscal year 2024/25 and 245 billion for 2025/26. The IMF review, initially set for July 10, was delayed to July 29 due to pending policy details. Upon conclusion, the IMF is expected to release $820 million to Egypt.

(With inputs from agencies.)