Egypt’s Cabinet has ruled out any change in the prices of butane or in the mechanism of distributing it prior to the completion of a study that is being conducted on the new proposed distribution mechanism, a note from Beltone Financial cited Al-Ahram newspaper as reporting.
Minister of Energy and Petroleum has reiterated the government’s increase of its butane provisions by 25 percent to meet increased consumption during the current winter season and up until February 2011.
In its note, the Cairo-based investment bank said, “These comments come in response to reports of shortages in the provision of butane canisters in some governorates across Egypt such as Kafr El-Sheikh, Ismailia and Beni Suef in December, which led to the subsequent increase in their prices as a result of black market practices.”
Butane gas is heavily subsidized by the government, and mostly used by the low-income class and higher-income groups residing in areas that are not linked to the national gas grid, Beltone explained.
“Under the new scheme, each family comprising one to three individuals will be entitled to one canister, a canister and a half for a family of four to five individuals, and two canisters for families of more than six individuals. The proposed price is expected to be LE 5 per canister, with additional LE 2 for home delivery.
“The mechanism also includes the option of providing canisters with a partial subsidy, and without a ration card, in which case, the price will be LE 25 per canister.”
