Ahmed Kamel – Egypt Daily News
Several Egyptian economists and former government officials have criticized the government’s recent decision to raise fuel prices, arguing that the move was rushed and based on uncertain assumptions about global energy markets and geopolitical developments.
The criticism comes after the government announced significant increases in the prices of gasoline, diesel, natural gas for vehicles and cooking gas cylinders, citing exceptional circumstances in global energy markets and the impact of the ongoing conflict involving the United States, Israel and Iran.
However, a number of economic experts say the decision was taken too quickly, particularly as the international factors cited by the government remain fluid and unpredictable.
Gouda Abdel Khalek, a professor of economics at Cairo University and former minister of social solidarity, said the government’s decision appeared to reflect “a degree of haste and confusion,” arguing that authorities should have waited until the situation in global markets became clearer.
Speaking to local media, Abdel Khalek said the official statement accompanying the decision relied heavily on broad justifications rather than detailed economic analysis, despite the availability of government institutions, research centers and consultants capable of providing deeper studies and projections.
He also criticized the structure of the price increases, arguing that the adjustments disproportionately affect lower-income groups. According to Abdel Khalek, the increase in the price of lower-octane gasoline, commonly used by more modest vehicles, reached around 30 percent, while the increase for higher-grade gasoline typically used by luxury vehicles was significantly lower.
The economist also warned about the decision to raise diesel prices by the same amount as gasoline, noting that diesel plays a central role in commercial transportation, including the movement of goods and passenger transport across the country. He predicted that higher diesel prices could trigger a new wave of price increases in markets as transportation costs rise, potentially pushing inflation rates upward again.
Abdel Khalek further argued that the decision conflicts with the principles of social justice, as the burden of rising energy costs falls disproportionately on lower-income citizens. He said the move could also signal to traders and businesses that price increases across goods and services are likely to follow.
The 30 percent increase in compressed natural gas used for vehicles also drew criticism from the economist, who said the rise contradicts government plans promoting cleaner energy and the expansion of natural gas as a lower-cost alternative fuel.
Similar concerns were expressed by Yemeni El-Hamaki, professor of economics at Ain Shams University, who said the latest fuel price increase could harm both producers and consumers and undermine the fragile market stability achieved in recent months.
El-Hamaki questioned the timing of the decision, arguing that the war involving Iran may not last long and noting that global oil prices have already begun to retreat after an initial spike in recent days.
She also raised doubts about whether the government would be able to lower fuel prices again if international conditions improve, suggesting that policymakers should instead explore alternative measures such as reducing government spending rather than placing additional financial pressure on citizens.
“This is not just hardship,” she said, describing the accumulation of economic pressures on citizens as “daily grinding.”
Meanwhile, Alia El Mahdy, former dean of the Faculty of Economics and Political Science at Cairo University, also described the decision as rushed.
El Mahdy warned that the government may face renewed inflationary pressures as higher fuel costs feed through transportation and production chains into consumer prices. She added that uncertainty surrounding the duration of the regional conflict and fluctuations in global oil prices should have encouraged a more cautious approach.
The criticism highlights a broader debate within Egypt over the balance between fiscal reforms and social protection as the government seeks to manage rising global costs while maintaining economic stability. Economists warn that while fuel subsidy reforms are often necessary for long-term fiscal sustainability, the timing and structure of such decisions can significantly influence inflation, market stability and public confidence in economic policy.
