Kuwait Considers Ending Diesel Subsidy

Kuwait’s government this week agreed ‘in principle’ to end diesel subsidies. But Kuwait’s fractious politics may make this difficult to implement.

For the ending of diesel sibsidies to take effect Kuwait’s Higher Planning and Development Council must study and approve the plan.

Diesel is sold at about $0.20/liter in Kuwait. This has encouraged significant over consumption and some degree of smuggling, presumably by sea to nearby ports in Iran. Parliament in 2012, and before that in 2009, launched an investigation into diesel smuggling to Iran from the small Kuwaiti port of Doha (MEES, 19 March 2012).

The government cites “abuse” of the product as a key reason it will lift diesel subsidies. There are no current plans to reduce subsidies for other products.


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