Local fuel prices reflect int'l prices — Hamed

AMMAN — Fuel prices in Jordan “accurately reflect international oil prices, Energy Minister Mohammad Hamed said Wednesday. 

Hamed added that prices of oil derivatives on the local market are calculated at the end of each month based on international prices of oil, with the addition of other costs such as shipment, handling and taxes on gasoline.

A government pricing committee meets monthly to adjust prices in a manner that corresponds to changes in oil prices on the international market.

Further explaining the pricing methodology in a statement carried by the Jordan News Agency, Petra, the minister said the average cost of each derivative during the past 30 days is calculated according to the Platts Energy Bulletin, after adding all costs involved in the commodity’s delivery to end users, including the 6 per cent special tax and 0.006 per cent “stamp duty”, the fee levied on official documents.

Hamed’s remarks come one day after a lawmaker asked the government to be transparent regarding the pricing of fuel during a Lower House session.

The minister noted that there are additional costs set by international markets for the product to reach Aqaba, according to Petra.

These include maritime transportation costs from Singapore on the Mediterranean route, passing through Yanbu Port in Saudi Arabia before reaching Aqaba Port. 

Added to that are the costs of maritime insurance, fuel waste during transportation and the fees paid for letters of credit issued by banks to secure the cargo.

Additional costs in Aqaba include Aqaba Ports Corporation fees, delay fines, and storage and handling costs paid to the Jordan Petroleum Refinery Company (JPRC).

Other costs are related to land transportation from JPRC to fuel stations, distribution, fuel station profits, and changes in the value of stored fuel.

Jordan imports more than 95 per cent of its energy needs.

During the month of December, which witnessed a drop in fuel prices, one litre of unleaded 90-octane gasoline is sold at JD0.690, while 95-octane costs JD0.835 per litre. 

The price per litre of diesel and kerosene is set at JD0.545 this month, while the subsidised price of gas used for cooking and heating remain unchanged at JD10 per cylinder.