The Ministry of Finance announced that Ethiopia is taking remedial measures to resolve the fuel crisis that has emerged following the war in the Middle East. Finance Minister Ahmed Shide stated that the government is providing high subsidies to ensure the fuel supply remains reliable and aligned with purchasing power. He pointed out that to withstand the international fuel crisis, the government is providing fuel products by increasing the previous subsidy rates.
The Minister explained that although global prices have skyrocketed due to the closure of the Strait of Hormuz following the Middle East war, the government is supplying the market by making only minor price adjustments through heavy subsidies. To prevent a supply shortage caused by the closure of the Strait of Hormuz, the government is also carrying out additional fuel purchases.
Indicating that the price adjustment made yesterday is highly subsidized relative to the current fuel market, the Minister explained that while the price of white diesel which was previously subsidized at 53 Birr and 68 Cents, has reached 238 Birr and 13 Cents per liter today, the government is providing it to the public at 139 Birr and 84 Cents by applying a 98 Birr subsidy.
Similarly, he noted that while the price of benzene, which the government used to subsidize at 28 Birr and 77 Cents per liter is currently selling at 205 Birr and 74 Cents per liter globally following a sharp increase, it is being provided to the public at 132 Birr and 18 Cents per liter through a subsidy of 73 Birr and 56 Cents.
The Minister stated that studies have identified that this fuel supply, for which the government provides heavy foreign exchange subsidies, is being brought to market in improper ways outside of the set prices and the supply chain. He announced that legal action has begun against those involved in these illegal activities to prevent such practices. To withstand the international crisis, the government is taking measures including emergency purchases and releasing supplies from the established strategic reserve into the market.
The Minister, who stated that the public should work in cooperation with security forces to prevent transactions outside the supply chain, also urged that economy should be practiced in fuel consumption.
