Rhein on Energy and Climate

With oil prices having declined to less than $90 per barrel, a low level not seen for more than a decade, oil/gas subsidies are becoming a costly affair to countries with high production costs like Russia, Egypt, Yemen, Venezuela, Indonesia. At the same time, due to the lower prices consumers enjoying them will hardly feel the abolition of the subsidies.

This is therefore the right moment to abolish them or at least start phasing them out. At the forthcoming Climate Conference in Lima, the IEA should therefore make a renewed plea for their abolition; and the international community should lend its full-hearted support for such action.

A decision to phase out oil/gas subsidies in Lima it would be the first time ever that a climate conference produces a tangible result by ending an unforgivable incentive to fossil energy.

Eberhard Rhein, Brussels, 20/10/2014

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