The Egyptian General Petroleum Corporation (EGPC) has made proposals to help the government cut LE35 billion ($5.8 billion) of subsidies on petroleum products from the country's budget over the next five years. Subsidies for petroleum products totaled around LE 110 billion in Egypt's budget for the 2011/12 financial year. The new suggestions from EGPC, a state-run firm owned by the Ministry of Petroleum, include selling car-owners monthly books of coupons worth LE 2,500 ($417) which can be exchanged for a total of 200 liters of petrol, Al-Ahram newspaper reported on Wednesday. Once a consumer spends all their coupons, they will pay for petrol at the standard, non-subsidized rates. A litre of Octane 80 currently costs LE 0.9 ($0.15); Octane 90 sells for LE 1.75 ($0.29), and Octane 92 for LE 1.85 ($0.3). Octane 95, which costs around LE 2.75 ($0.45) per liter, should see a price hike to reflect production costs, EGPC said. The corporation also proposed that Egypt's government increase by 30 per cent the prices for natural gas paid by energy-intensive industries. The price of fuel oil should be hiked to LE 1,250 per tonne as it is used for industrial purposes, EGPC suggested. However it said that energy used by domestic consumers, such as cooking butane, should not see price readjustments. In December 2011, Egypt's cabinet approved a plan to cut energy subsidies for energy intensive industries as part of an austerity plan to reduce the budget deficit by LE 20 billion ($3.3 billion). But despite an agreement to gradually lift industrial subsidies from the start of this year, business figures say the plan has not been enacted.
