25 May 2010
The government increased the price of a 20-liter cylinder of gas by 30 percent from YR850 to YR1100 during last week.
The Study & Economic Media Center warned that the increase only compounded problems from the already large 110 percent increase in gas prices from last year.
Gas is currently sold at YR1100 in gas shops comparing to YR850 per cylinder last week, and YR500 for a cylinder at the beginning of last year, 2009.
The center reported that the gradually removed support of oil derivatives including petrol, diesel and gas as been accompanied by poor protection programs. The center also affirmed that it is likely that this policy will lead to an expanded poverty rate among Yemenis. Some economists confirmed that, "although the government supports the price of gas, the first beneficiary is not the people. Rather, the black market traders who smuggle gas to neighboring countries profit the most. The prices of gas in Saudi Arabia and Oman reached YR2000 and YR4200 in Somali and Djibouti.
"Yemen is a developing country, so any increase in basic materials such as gas will have many negative economic effects," said Dr. Taha al-Fosiel, economist at Sana'a University.
Yemen LNG is constructing a new Liquid Propane Gas (LPG) Extraction Unit in Marib that will increase LPG supplies to domestic market by 33 percent.
The government increased the price of a 20-liter cylinder of gas by 30 percent from YR850 to YR1100 during last week.
The Study & Economic Media Center warned that the increase only compounded problems from the already large 110 percent increase in gas prices from last year.
Gas is currently sold at YR1100 in gas shops comparing to YR850 per cylinder last week, and YR500 for a cylinder at the beginning of last year, 2009.
The center reported that the gradually removed support of oil derivatives including petrol, diesel and gas as been accompanied by poor protection programs. The center also affirmed that it is likely that this policy will lead to an expanded poverty rate among Yemenis. Some economists confirmed that, "although the government supports the price of gas, the first beneficiary is not the people. Rather, the black market traders who smuggle gas to neighboring countries profit the most. The prices of gas in Saudi Arabia and Oman reached YR2000 and YR4200 in Somali and Djibouti.
"Yemen is a developing country, so any increase in basic materials such as gas will have many negative economic effects," said Dr. Taha al-Fosiel, economist at Sana'a University.
Yemen LNG is constructing a new Liquid Propane Gas (LPG) Extraction Unit in Marib that will increase LPG supplies to domestic market by 33 percent.
By Faisal Darem
© Yemen Observer 2010
