Aql: Gradual Fuel Pricing Protected Jordanians from Global Price Shock
Jordan Mitigates Oil Impact on the Market.. Citizens First, Treasury Pays the Difference
Amman4 min read
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When global oil and oil derivatives prices rose, Jordan faced a difficult equation: how to ease the burden on citizens and economic sectors without the treasury bearing open differences? Energy expert Hashem Aql believes the government chose to distribute the impact of the rise in stages, through gradual pricing, temporary stabilization, and bearing part of the cost, with special attention to diesel due to its connection to transportation, production, and commodity prices.
Aql said that during 2026, Jordan did not fully reflect global increases in local selling prices. Although the oil derivatives pricing committee reviewed the average global prices during the 30 days prior to pricing, decisions in several months tended to pass on part of the increase or stabilize prices when fluctuations intensified.
He cited the June pricing, when the estimated actual cost per liter of diesel was 960 fils, compared to a local selling price of 850 fils, while the actual cost of 90 octane gasoline was about 1069 fils, compared to a selling price of 1000 fils. The pricing committee explained at the time that it reflected only about 35% of the actual increase in diesel cost, while stabilizing the prices of gasoline, kerosene, and domestic gas cylinders.
Aql added that the actual cost per liter of diesel reached, according to his estimate for September, about 1.12 dinars, while the local selling price remained at 850 fils. He believed that the difference illustrates the magnitude of the increase that did not directly transfer to the consumer.
He explained that the government kept the prices of main derivatives stable during July, August, and September, despite the rise in global average prices, at 1000 fils per liter for 90 octane gasoline, 1310 fils for 95 octane gasoline, 850 fils for diesel, and 550 fils for kerosene, in addition to stabilizing the price of domestic gas cylinders at 7 dinars. LPG support for the industrial sector also continued.
According to Aql, giving priority to diesel in this policy goes beyond its impact on drivers; it is involved in transportation, shipping, agriculture, industry, and services. Therefore, limiting the rise in its price helps reduce the increase in production and transportation costs, and reduces the likelihood of its transfer to the prices of goods and services. The stabilization of the price of gas cylinders and the support of gas for industry also expanded the scope of treatment to include households and some production inputs.
He pointed out that many countries followed different policies to deal with rising gasoline, diesel, and gas prices, while fuel prices remained high in a number of their markets, increasing inflationary pressures and the risk of economic activity slowdown. The specificity of the Jordanian approach, according to Aql, lies in combining monthly pricing, gradualism, bearing cost differences, temporary stabilization, and targeted support, instead of the shock's impact being transferred to the market all at once.
He believed that the results of this policy appear at three levels: protecting the consumer from a sudden jump in fuel prices, reducing pressure on sectors that depend on diesel, and allowing time for households and companies to adapt to rising global costs.
However, Aql emphasized that the differences that the consumer does not pay disappear; the treasury bears them. Total support and price differences since the beginning of the crisis amounted to about 212 million dinars by the end of July, then rose to about 224 million dinars by the end of August, according to government figures announced with the September pricing, which includes support for domestic gas cylinders.
Aql expected the cumulative cost to reach about 260 million dinars with the October pricing if price pressures continued. He said that bearing these amounts by the treasury also requires considering the opportunity cost, as the public resources directed to absorb the rise in fuel could have been used for infrastructure projects, health, education, or covering other current expenses.
He concluded that Jordan has so far succeeded in mitigating the shock and distributing its impact over time on citizens and economic sectors, but the continuation of this policy is linked to the budget's ability to bear its costs and the trajectory of oil and derivatives prices in the coming months.
