IMF: Drop in Fuel Prices Reflects Stronger EGP

The head of the International Monetary Fund (IMF) mission to Egypt Subir Lall praised the decision of the automatic pricing announced yesterday.

The Committee had acknowledged the reduction of prices of some petroleum products in the Egyptian market in light of the decline in the price of Brent barrel and the decline in the exchange rate against the dollar.

Lall added that the adjustment of the price is consistent with the application of the automatic pricing mechanism announced last July.

The mechanism allows to modify the price of some petroleum products up and down quarterly, and allow maintaining a price level that covers the cost of producing and selling these products in the Egyptian market.

Lall also praised the decision, which was approved by the Committee last Thursday, in light of the decline in the price while maintaining the coverage of the actual cost, without adversely affecting the performance of the public budget.

The Automatic Pricing Committee of Fuel Products, which reviews and determines the prices of some petroleum products on a quarterly basis, approved the reduction of the price of three types of petrol products in the domestic market by 25 piasters per liter to record EGP 6.5 for gasoline 80, EGP 7.75 for gasoline 92 and EGP 8.75 for gasoline 95.

The committee attributed its decision to the decline in the price of Brent barrel on the world markets during the period from July to September 2019 to an average of about 62 dollars per barrel, and the depreciation of the dollar against the pound to achieve an average of about 16.60 during the same period.

In the meantime, Oil slid below $58 a barrel following concerns about global economic growth, and excessive supply leading to OPEC cuts.