Automotive

Saudi fuel prices could rise by 80% soon

saudi-petrol increase

Saudi energy prices are set to steadily increase between 2018 and 2021 as the Kingdom is considering phasing out subsidies for gasoline and jet fuel.

The government plans to raise energy prices in October at the earliest and most likely early next year. It was announced last December by Energy Minister Khalid Al-Falih that there would be an energy increase in 2017.

Since the drop in crude oil prices in 2014, the oil-rich country wants to boost gasoline prices to match the international market. This would mean that petrol prices could increase by around 80%.

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For octane-91 grade gas, you currently pay SAR 0.75 per litre, but you could soon be paying up to SAR 1.35 per litre – this roughly equals to only $0.36, which means that Saudi consumers will still enjoy some of the cheapest petrol prices anywhere in the world.

The UAE was the first country to remove subsidies on transport fuel when it began linking gasoline and diesel prices to the global oil markets in August 2015. Although petrol prices in the UAE follow the market trend, gasoline and jet fuel will undergo one-time increases under the Saudi Arabian plan. The Kingdom’s government will instead focus on raising prices of other fuels gradually.

SEE ALSO: Do you want to be a car owner? Find and compare the best car loans in the Kingdom

To help adjust with the subsidy cuts, austerity measures will be put in place to help low and middle-income families. The Citizen’s Account has been set up to support Saudi families by providing direct financial allowances.

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