U.A.E. Removes Fuel Subsidy a long, long overdue move as we discussed many pages ago with terrible knock-on effects.

Gasoline is now subsidized in the U.A.E., the second-biggest Arab economy and home to about 6 percent of the world’s oil reserves. Unleaded gasoline 98 octane in the U.A.E. sells for 1.83 dirhams (50 cents) a liter, according to prices on the ministry’s website. The U.S. price of premium unleaded gasoline is $3.18 a gallon, or 84 cents a liter, according to AAA, the biggest U.S. auto group. That compares with 16 cents in Saudi Arabia, the largest OPEC producer.
It will be wise the review it in a couple of months..

A The Context of Fossil-Fuel Subsidies in the GCC Region and Their Impact on Renewable Energy Development offers a great deal of, well, context to the economic folly.

By now it has been recognized that the low pricing of fossil fuels has led to a number of adverse impacts. While GCC countries have among the highest GDPs per capita in the world, the opportunity cost of selling fuels domestically at prices below international market rates and the volatility in world oil prices have started putting fiscal pressure on GCC governments. Low fuel pricing has resulted in domestic over-consumption of hydrocarbons and the absence of incentives to achieve energy efficiency in the economy. At the same time, renewable energy uptake has been impeded by a lack of competitiveness.