Amman:The government has taken on a significant financial burden by absorbing JD224 million in fuel price differences since regional tensions began, as crude oil prices soared past $120 a barrel. This move aims to mitigate the direct impact on Jordanians and various economic sectors.
According to Jordan News Agency, the government has not fully passed on the global increases in fuel costs to local prices. It provides direct support of JD1.6 million a month for liquefied petroleum gas used in the industrial sector to preserve the competitiveness of national products and manage local production costs amidst global market fluctuations.
Energy expert Hashem Aqel highlighted that this strategy has prevented sudden “price shocks,” which could erode purchasing power, deepen inflation, and destabilize transport and production costs. Aqel noted that while monthly pricing decisions reflect only a partial share of the global price increases, the remaining differences are absorbed through the general budget. This policy has delivered relative stability in local prices, but it also places a cumulative burden on the treasury.
Nahar Saidat, head of the General Association of Petrol and Gas Distribution Station Owners, stated that oil prices have risen sharply due to the regional tensions, causing insurance costs and transport fees to triple. He emphasized that the government has prudently managed the kingdom’s energy system by diversifying sources of imported oil, ensuring sufficient stock levels despite shortages in neighboring countries.
Saidat also mentioned that local prices have remained at “acceptable” levels as the government bore the burden of global price increases through gradual adjustments and price fixing. The government continued to freeze prices last month, even as global prices continued to rise.
Economic expert Munir Dayah remarked that the government’s decision to freeze fuel prices for several months further reflects its approach to gradually pass on global increases and absorb a significant portion of the price differences. Aqel anticipates that the cumulative price differences borne by the treasury could reach JD250 million by the month’s end.
