Sunday,20 August, 2017
Current issue | Issue 1349, (15 - 21 June 2017)
Sunday,20 August, 2017
Issue 1349, (15 - 21 June 2017)

Ahram Weekly

Fuel what-ifs

What if gas and diesel prices in Egypt become like those in Europe? Mohamed Abdel-Razek provides some solutions

Rumours have been flying in the country about an expected increase in fuel prices.

Nobody knows when exactly this will happen but people have been talking about whether the cost of fuel in Egypt will become the same as in the West which would be too high considering the average personal income in the country.

According to GlobalPetrolPrices.com, the average global price of gasoline (petrol) is $1.01 per litre, which means LE18, if one dollar is worth LE18. And according to the same source, the average price of diesel is $0.9, which means LE16.2.

An increase in fuel prices has swept many countries in the last couple of months. In Turkey, one litre of petrol costs $1.39 (£1.15), which is 10 per cent more expensive than it used to be three months ago. In Switzerland, one litre of petrol costs $1.42 (£1.18), which is 4.7 per cent more expensive than three months ago. In the UK, one litre of petrol costs $1.45 (£1.20), 5p more expensive than three months ago. It’s the same thing in Germany which had a bigger increase of 4.7 per cent. In France, with a 9.4 per cent increase, it’s now $1.51 (£1.25). In Portugal, the price is higher, with a 6.8 per cent increase in the last three months, now at $1.56 (£1.29). In Italy, with a 5.8 per cent increase in the past three months in fuel prices, it’s now $1.63 (£1.35). No wonder the Fiat 500 is so popular out there.

The most popular gasoline among Egyptians is the octane-92 which currently costs LE3.5, cheaper than in Saudi Arabia in which fuel costs $0.24. The less popular octane-95 in Egypt costs LE6.25.

With the current dramatic increase in the currency margin between the Egyptian pound and the dollar, the Egyptian government is under great pressure to provide fuel at old prices. So thinking out of the box right now is not an option in order not to sacrifice the economy of the country and the financial situation of its people. In this case the government should look for less costly alternatives, such as asking car companies to provide more diesel passenger cars for the masses. That will cover more kilometres than normal gasoline and will be even cheaper to refuel.

Another idea is providing hybrid cars that work on both gasoline and electricity. This will decrease emissions and save fuel both for the owner and the country. Another idea is pure electric cars, cars that operate with charged batteries. These cars will decrease the overall consumption of gasoline in the country, which will remove the pressure off the economy, as well as the consumer who won’t be spending much money on servicing his car. Electric cars can be the savior for both the Egyptian government and the consumer, with the country investing in many electricity plants that generate tons of electricity. Charging stations could be set up by the government in streets across the country.

Increasing fuel prices is happening all over the world, and will keep on increasing, simply because gas is getting scarcer. Now countries are trying to find alternatives, and Egypt should not be an exception.

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