The Magnitude and Distribution of Fuel Subsidies: Evidence from Bolivia, Ghana, Jordan, Mali, and Sri Lanka

By Robert Gillingham, David Locke Newhouse, David Coady, Kangni R Kpodar, Moataz El-Said, Paulo A Medas

November 1, 2006

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Robert Gillingham, David Locke Newhouse, David Coady, Kangni R Kpodar, Moataz El-Said, and Paulo A Medas. The Magnitude and Distribution of Fuel Subsidies: Evidence from Bolivia, Ghana, Jordan, Mali, and Sri Lanka, (USA: International Monetary Fund, 2006) accessed September 19, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

With the recent jump in world oil prices, the issue of petroleum product pricing has become increasingly important in developing countries. Reflecting a reluctance of many governments to pass these price increases onto energy users, energy price subsidies are absorbing an increasing share of scarce public resources. This paper identifies the issues that need to be discussed when analyzing the fiscal and social costs of fuel subsidies. Using examples from analyses recently undertaken for five countries, it also identifies the magnitude of consumer subsidies and their fiscal implications. The results of the analysis show that-in all of these countries-energy subsidies have significant social and fiscal costs and are badly targeted.

Subject: Energy subsidies, Fuel prices, Inflation, Oil prices, Personal income

Keywords: Formula price, Fuel price, Oil price, Petroleum products, Price rise, WP

Publication Details

Pages:

37
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2006/247
Stock No:

WPIEA2006247
ISBN:

9781451865073
ISSN:

1018-5941

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