The reduction of fuel subsidies has been a key lever for Saudi policy makers in their efforts to modernize the economy in recent years (MEES, 5 January 2018). But amid inflationary pressure, the kingdom has this month opted to cap fuel prices as global prices trend upwards.

The kingdom has slashed fuel subsidies over the past five years, and the upshot has been that even before the pandemic, domestic consumption of diesel and gasoline had fallen below their peaks of 2015 and 2017 respectively. (CONTINUED - 261 WORDS)