Oman oil minister slams energy subsidies

abu dhabi — Subsidised petrol and electricity programmes are causing a huge waste of energy across the Gulf and threatening economies, Oman’s oil and gas minister said on Sunday, in a rare official warning over surging demand in the region.

Energy prices are heavily subsidised in the six member states of the Gulf Cooperation Council (GCC).

“We are wasting too much energy in the region and the barrels that we are consuming are becoming a threat now, for our region particularly... I think we have a serious problem,” Oman’s oil and gas minister Mohammed bin Hamad Al Rumhy told the Adipec energy conference in Abu Dhabi.

“What is really destroying us right now is subsidies... We simply need to raise the price of petrol and electricity. In some countries in our region electricity is free and you leave your air conditioning for the whole summer when you go on holiday. That is really a crime,” he said.

“Our cars are getting bigger, our consumption is getting bigger and the price is almost free. So you need to send a signal to the pockets of the public.”

It was not clear whether Rumhy’s remarks indicated any fresh change to Oman’s domestic energy pricing policies. Oman announced plans in early 2013 to double its industrial gas price to $3 per million British thermal units, still cheap by international standards.