In Jordan fuel prices will rise between 5 and 22 percent

Fuel prices in Jordan will be hiked at midnight as part of efforts to offset the impact of world oil prices on the budget deficit, Prime Minister Adnan Badran said Tuesday. It is Jordan's second fuel price increase in three months.

Prices will rise between 5 and 22 percent, depending on the type. Badran told reporters that the hikes were in line with the government's plan to gradually remove subsidies on fuel. To cushion the impact, the government will make a one-time disbursement to those whose monthly income is less than 400 Jordanian dinars (US$564; Ђ464), including retired civil servants and members of the armed forces.

Badran said the price of gasoline will increase 5 percent, diesel and kerosene will go up 20 to 22 percent, and the price of a cylinder of cooking gas will rise 0.25 JD (US$0.36; Ђ0.3). In July, the government raised the prices of oil derivatives by up to 33 percent, saying it was a first step toward the abolition of fuel subsidies in three years.

Badran said the government had to take this step because the rise in world oil prices had caused the projected budget deficit to increase to 722 million JD (US$1.2 billion; Ђ1 billion). When the government announced its 2005 budget in January, it said the deficit was envisaged at 270 million JD (US$381 million; Ђ313 million). Jordan imports all its fuel from Saudi Arabia, Kuwait and the United Arab Emirates, AP reports.